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Quantitative Finance · Glossary

What is Depositary receipt ratio?

Definition 14.1 Market Making and High-Frequency Trading · Chapter 14 — Depositary Receipts and Dual Listings

The depositary receipt ratio is the number of home-market shares one receipt represents (or its inverse, as the depositary states it); with it and the exchange rate, a receipt’s parity value is the home price times the ratio times the currency’s price in the receipt’s currency.

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