SIE Exam Question 408: Answer and Explanation

Question: 408

The security instrument most often associated with enabling a US investor to facilitate trading in foreign stock is:

• A. ADR
• B. GDP
• C. CMO
• D. Forward contracts

Correct Answer: A

Explanation:

A: American Depository Receipts are receipts for foreign stock and are a best way for American investors to take beneficial ownership in shares of foreign corporations.