By transforming the way investors and companies interact on a global scale, ADRs and GDRs continue to shape the future of international investing. Between 1988 and 2018, German car manufacturer Volkswagen AG traded OTC in the U.S. as a sponsored ADR under the ticker VLKAY. Morgan established an unsponsored ADR for Volkswagen, trading under the ticker VWAGY. A few years later, in 1931, the bank introduced the first sponsored ADR for the British music company Electrical & Musical Industries, the eventual home of the Beatles. Today, J.P. Morgan and BNY Mellon, another U.S. bank, continue to be actively involved in the ADR markets. GDRs are exchange-traded securities that represent ownership of shares in a foreign company, where those actual shares are traded abroad. Using GDRs, companies can raise capital from investors in countries around the world. GDRs can in theory be denominated in any currency, but are nearly always in U.S. dollars. Since GDRs are negotiable certificates, they trade in multiple markets and can provide arbitrage opportunities to investors. While shares of an international company trade as domestic shares in the country where the company is located, global investors located elsewhere can invest in those shares through GDRs. ADRs enable […]