ADR Product Definition

Securities traded on many exchanges throughout the world can only be traded and settled in other countries in a form that complies with the regulations of that country’s market. The purpose of ADRs (American Depository Receipts) or GDRs (Global Depository Receipts) is to represent a security for the local market. Each ADR has its own ISIN code, which is different from the corporation’s original equity.

The ADR trade can be transformed into the original equity or switched back to its local form.

 

1. Defining an ADR

To define an ADR product, from Calypso Navigator choose Configuration > Equity > ADR (menu action product.ADRWindow).

 

1.1 Loading an Existing ADR

You can load an existing ADR into the ADR window using one of the following methods:

» Select a security code from the Security Code list, and enter the actual code value in the adjacent field.

Then click Search to load the corresponding ADR.

ADR window - Loading an ADR by security code

» You can also click near the top of the window to open the Product Chooser window - Help is available from that window.

ADR window - Loading an ADR

 

Then modify the fields described below as needed.

 

1.2 Creating a New ADR

» Click and enter the fields described below.

 

1.3 Modifying an ADR Name

» Click to rename the ADR. You will be prompted to enter a new name.

 

1.4 Setting Custom Data

 Ⓘ   [NOTE: The Custom Data button is deprecated and has no function beginning in Release 12.0]

 

1.5 Saving an ADR

» Click to save your changes. You will be prompted to enter an ADR name.

The system also saves a quote name for the product that is used to enter / retrieve market quotes.

You can also click to save the ADR as a new product. You will be prompted to enter a new name.

 

Definition Fields Details

Fields Description

Name

Name of the ADR specified when the ADR is saved.

Product Id

Unique id given by the system when the ADR is saved.

Corporate

The long name of the corporate entity.

ADR Type

Select the product subtype: ADR or GDR.

The subtype is for information purposes and can be used for filtering ADRs.

Currency

Select the product currency.

BB_CALC_TYP

Expand this label to view all the security codes defined for ADR products.

You can enter a value for each security code as applicable.

You can create new security codes using Calypso Navigator > Configuration > Product > Code.

Country

Select the country of the ADR.

Exchange

Select the market place where the ADR is traded. The market place is a legal entity of role MarketPlace.

You can expand the Exchange to enter the Spot Days: default number of business days between the trade date and the settlement date. Business days are determined using the holiday calendars of the market place.

Quote Type

Select the type of quote for the ADR: Price, PriceVol, or PriceC (when the price is quoted in the number of cents).

You can expand the Quote Type and specify whether to create special quotes or not.

» Set "Special Quote = Yes" to allow creating special quote names – You need to select the fixing type in that case – Upon saving the product, the system will save the standard quote name, and "<standard quote name>.<fixing type>" – The special quote is used for fixing and settlement.
» Set "Special Quote = No" otherwise.

Fixing Types

The following fixing types are supported in addition to CLOSE, OPEN, HIGH, LOW, and LAST:

• Future Price Reference (EDSP) – This is a special quote typically known at the Open of the market trading. EDSP is published by a future or option exchange.
• Volume Weighted Average (VWAP) – The average price of the day is popular as a fixing because many exchanges and brokers allow clients to Buy or Sell shares at the VWAP. Therefore, Fixing at the VWAP facilitates the orderly removal of hedge transactions.
• Prezzo di Riferimento (PDR) – A special Italian Exchange-published level that is used to settle exchange and OTC derivatives.

Issuer

Select the issuer, a legal entity of role Issuer.

Trading Size

Enter the minimum number of ADRs that can be traded.

Trading Country

Select the country where the registry / depository is located.

Total Issued

Enter the number of ADRs that have been issued.

Nominal Decimals

Enter the number of decimal places for nominal prices.

Pay Dividend

Check the Pay Dividend checkbox if the ADR pays a dividend.

You can expand Pay Dividend and specify a dividend currency, dividend frequency, and the number of dividend decimals.

The Dividend Frequency is used when creating a discrete dividend curve, to generate the projected dividends.

The Dividend Date Rule is not currently used.

Underlying

Select the underlying equity.

Active From

Enter the start date of the ADR – It cannot be traded before that date.

Active To

Enter the end data of the ADR – It cannot be traded after that date.

Status

It mostly applies to Bloomberg static data integration but you can use it for your own purposes otherwise.

It shows the status of the integration. You can change it as applicable.

• NOUPDATE: Do not update from feeds.
• PENDING: Automatic changes were made via a feed update. The changes have not yet been verified.
• VERIFIED: The data has been verified.

Ratio: ADR Number

Ratio: Underlying Number

Enter the number of ADR shares for a number of shares of underlying.

Sponsored

Check the Sponsored checkbox if the ADR is sponsored by an issuer selected by the corporation of the ADR, or uncheck it otherwise.

This is for information purposes only.

Fee Currency

Enter the currency of the fee to be paid to the issuer.

Create Cost

Enter the fee amount to be paid when creating the ADR from the underlying equity.

Bust Cost

Enter the fee amount to be paid when transforming the ADR into the underlying equity.

Comment

Enter a free-text comment as applicable.

 

2. Reviewing Corporate Actions

The CA tab shows the corporate actions that have been created for the ADR.

This is for information purposes only.

ADR window - CA panel

 

3. Specifying Dividends

 Ⓘ   [NOTE: The Dividend panel is not supported and must not be used to create dividends. The dividends must be created directly from the Corporate Actions window]

 

4. Defining Security Codes by Legal Entity

Select the Legal Entities panel to specify security codes by legal entity as applicable. A row is created by default for the issuer of the ADR.

ADR window - Legal Entities panel

You can use this panel to specify for example specific security codes by market place.

» Click to add a legal entity, then select a role, a legal entity, a security code (product code), and enter a product code value. Repeat as needed.
» Click to save your changes.

 

5. Viewing Audit Information

Select the Audit tab to view Audit information recorded for the ADR. This only applies if the Audit mode is enabled.

ADR window - Audit panel

You can right-click the table and a number of functions will be available for configuring the layout.