Global depository receipt

A Global Depository Receipt ( GDR) is the global shape of the Depository Receipt / Depositary Receipts and consequently a certificate that certifies the ownership of a share.

Background

A GDR is always based on an underlying equity and reflects a fraction of that, just a stock or a group of these shares. While most Warrants represent the right to a share without the right to the dividend of each share, as this right is included in the GDRs. By mapping the underlying ( an underlying share) in a GDR is otherwise " foreign " stock at a local securities. Since many investors are not allowed due to legal or statutory provisions to invest in foreign securities and such foreign securities have to get set up outside the home country often simultaneously difficulties of going through the GDRs an often chosen variant to a company's stock is also in the to market abroad.

The Notes represented by the GDRs shares are then traded on this vehicle. Since GDRs are very similar share due to their structure, investments in these are often considered in eg financial statements and fund prospectuses as a normal investment in conventional equities.

History

Global Depository Receipts have been developed along the lines of American Depository Receipts.