CIBC launches Canadian Depositary Receipts

CIBC, NEO, and CIBC Mellon have brokered a partnership that will see the launching of the first-ever Canadian Depositary Receipts (“CDRs”) to be listed on the NEO Exchange. 

CDRs provide a new and innovative way that could revolutionize how investors in Canada purchase and hold shares of global corporations.

Tailored in a similar fashion to the American Depositary Receipts (“ADRs”), CDRs make investing in global multinationals using Canadian Dollars possible and also very seamless.

CDR offers are a fraction of the share price of the underlying reference share and also have a built-in notional currency hedge. This option, therefore, allows freer access to foreign listings with a reduced or controlled level of risk.

The initial set of CDRs that will be available on the stock market include:

• Alphabet Canadian Depositary Receipts (CAD Hedged) – GOOG

• Amazon.com Canadian Depositary Receipts (CAD Hedged) – AMZN

• Apple Canadian Depositary Receipts (CAD Hedged) – AAPL

• Netflix Canadian Depositary Receipts (CAD Hedged) – NFLX

• Tesla Canadian Depositary Receipts (CAD Hedged) – TSLA

Other CDR listings are expected to become available for trading soon. Christian Exshaw, Managing Director at CIBC said, “as a Canadian industry-first, CDRs will allow investors to affordably purchase global equities, access institutional FX rates, and efficiently manage their currency risk.”