What is "depositary receipt"

n. a financial instrument, issued by a bank, that may be traded as if it were a share in a foreign company

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.

Depositary receipts that are listed and traded in the United States are American depositary receipts (ADRs). European banks issue European depository receipts (EDRs), and other banks issue global depository receipts (GDRs).