SIE practice questioneasyADRs
What do American Depositary Receipts (ADRs) allow U.S. investors to do?
- AInvest in foreign companies on U.S. exchanges✓ Correct answer
- BAvoid all currency risk
- CConvert bonds to stock
- DTrade only U.S. government securities
Explanation
Why A — Invest in foreign companies on U.S. exchanges
ADRs enable U.S. investors to own foreign company shares through U.S. exchanges. They do not eliminate currency risk, convert bonds, or limit trading to government securities.
Turn it into reps
Reading one answer is not the same as being ready
Lucky the Banker is a free practice app with 1,867+ SIE questions, weak-area tracking, and timed mock exams. No credit card, no paywall.
Related Equity Securities questions
- Which of the following gives existing shareholders the opportunity to maintain their proportionate ownership in a…
- Which statement best describes a cash dividend?
- How do stock warrants differ from stock rights?
- Which type of preferred stock allows unpaid dividends to accumulate and must be paid before common dividends?