In an increasingly interconnected global economy, investors seek opportunities beyond their domestic markets. One way to tap into international investments is through American Depositary Receipts (ADRs). ADRs are financial instruments that allow U.S. investors to invest in foreign companies without the need for direct ownership of the underlying shares. ADRs were introduced in the United States in the 1920s as a means for U.S. investors to invest in foreign securities. They provide a convenient way to access international markets and broaden investment portfolios. ADRs are typically issued by U.S. depositary banks, who hold the foreign company’s shares on behalf of the ADR holders. So, what exactly are ADRs and how do they work? ADRs represent ownership in a foreign company and are traded on U.S. stock exchanges, making them easily accessible to American investors. They are denominated in U.S. dollars, eliminating the need for currency conversion with each transaction. There are three main types of ADRs: Level I ADRs: These are the most basic form of ADRs and are traded on the over-the-counter (OTC) market. Level I ADRs are primarily used to establish an initial