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13
Year-End 2013 Report
| Global DR Trends
Unsponsored ADRs
As of December 2013, a total universe of 1,597 unsponsored
DR programs are available to investors. Together, Japan
and the UK are the most active countries, constituting
27% of total unsponsored program count and 35% of total
unsponsored trading volume. While there is a substantial
number of programs in Asia Pacific countries like Hong Kong,
China
4
and Australia, most of the liquidity in unsponsored
programs comes from Western European countries such as
France, UK, Germany and Switzerland.
In terms of industry, issuers from the Consumer (Cyclical)
and Industrial sectors are the most active industry sectors,
constituting 35% of the total unsponsored program count and
39% of total unsponsored trading volume.
Compared to same period last year, trading volumes of
unsponsored ADR programs decreased by 42 million DRs (or
-2%) to almost 1.6 billion DRs in 2013. The major contributors
to the decrease in overall unsponsored trading activity
occurred in programs from Italy (88 million DRs), Japan (19
million DRs) and France (16 million DRs), and was offset by
increases in trading volumes in programs from the UK (39
million DRs) and Indonesia (32 million DRs).
Although most industry sectors experienced increased
unsponsored DR trading volumes — such as the Financial (44
million DRs) and Communication (35 million DRs) sectors —
this was offset by significant drops in trading volumes from
the Industrial and Consumer (Cyclical) which had decreases of
89 million DRs and 47 million DRs, respectively.
Unlike traditional sponsored ADR programs, unsponsored ADR programs are established by a
depositary bank without the direct involvement of the respective non-U.S. company, provided
that the company’s securities represented by the ADR are either registered or qualify for an
exemption from Securities and Exchange Commission (SEC) registration. An October 2008 SEC
rule change simplified the manner in which this exemption is obtained, making it automatically
available to many non-U.S. companies provided they meet certain requirements.
Unsponsored Programs
Number of Programs
1, 2
Trading Volume
3
Others
37%
Italy
4%
France
4%
Singapore
4%
Germany
4%
Australia
6%
China
7%
Hong Kong
8%
UK
11%
Japan
15%
Others
14%
Italy
4%
Sweden
4%
Germany
5%
China
7%
Switzerland
7% Hong Kong
8%
UK
10%
France
16%
Japan
25%
Source: Bloomberg Financial Markets and Depositary Data Interchange
Source: Bloomberg Financial Markets and Depositary Data Interchange
Unsponsored Program Count: 1,597
Unsponsored Trading Volume: 1.6 billion DRs
1
Program count as of December 15, 2013.
2
The total of 1,438 programs as of December 15, 2013 also includes
15 unsponsored GDR programs.
3
Trading Volume as of December 15, 2013.
4
Unsponsored ADR programs represent “H shares” of companies
from Mainland China that trade on the Hong Kong Exchange.