Which of the following is true of American Depository Receipts (ADRs)?
A) Investors who buy ADRs have to pay a currency-conversion fee.
B) There is a minimum purchase requirement for ADRs.
C) Companies offer ADRs in the U.S. to appeal to mutual funds.
D) ADRs are listed and traded in London and Luxembourg.

Question

Quizplus · Accepted Answer

Companies offer ADRs in the U.S. to gain exposure to American capital markets and appeal to American investors. ADRs are often listed on American stock exchanges and can be purchased just like any other stock, without any minimum purchase requirement or currency-conversion fees. While ADRs may also be listed and traded in London and Luxembourg, this is not a requirement or defining characteristic of ADRs.

Which of the Following Is True of American Depository Receipts