Question

29. Choose the correct statement about Depository receipts (DR)
1. It let investors purchase shares in foreign companies.
2. The depositary receipt trades on a local stock exchange.
3. It is a negotiable financial instrument.
Correct answer code is

• A. Only 1 and 2
• B. Only 2 and 3
• C. Only 1 and 3
• D. All of the above

Answer 1

The correct option is D All of the above

A depositary receipt (DR) is a negotiable financial instrument issued by a bank to represent a foreign company's publicly traded securities. The depositary receipt trades on a local stock exchange. Depositary receipts facilitates buying shares in foreign companies, because the shares do not have to leave the home country