Pull Thousands In Extra Cash From Your Everyday Life
You know the companies.
You know the brands.
And there’s a good chance you have a few, if not many of them in and around your house.
You might have a pair of Adidas sneakers in your closet.
Perhaps you have a Volkswagen or BMW parked outside in your driveway.
Maybe you made Nestle chocolate milk for the kids this morning. A special treat because they did so well on their homework.
Perhaps you read about Novartis in last week’s paper. They were after all making headlines.
The point I’m making here is these companies and many others you know well, represent a huge pool of untapped income for you.
Potentially thousands of dollars, sitting right there in your home.
How do you convert these everyday items and brands into easy money?
The short answer is American depository receipts, better known as ADRs.
ADRs allow you tap into the wealth of successful foreign companies, the gains their stocks see, and the dividend payouts they offer.
All from the comfort of your home in the good ol’ U.S.
Most folks are unaware of how ADRs work, so today I want to explain a little more about them to get us started.
The Simple Way To Trade Internationally
ADRs, according to Investopedia, are “negotiable certificates issued by a U.S. bank representing a specified number of shares (or one share) in a foreign stock traded on a U.S. exchange.”
When you purchase an ADR you are buying a stock of a company that trades on a foreign market like Germany’s Deutscher Aktienindex (DAX) or Japan’s Tokyo Stock Exchange (TYO).
Purchasing ADRs is easy. With a few extra steps you can begin tapping these foreign markets and their companies as soon as today.
One of our editors pulled up the Adidas ADR on his TD Ameritrade dashboard with a few mouse clicks.
ADRs: The Risk and Reward… Explained
The benefit to ADRs is that holders don’t have to conduct purchases in foreign currencies. ADRs trade in U.S. dollars and clear through U.S. settlement systems.
This makes it a lot easier for folks like you to access a world of wealth… literally.
But with that said, it’s important to note there are a few caveats to using ADRs that you need to consider before purchasing any.
One caveat is that ADRs are NOT common stock. This means the value of an ADR is not the same as the value of a common share from the same company.
For example, the two Adidas ADR shares are equal to the value of one common share of Adidas.
When you trade ADRs be sure to investigate the unique stipulations of your chosen ADR before making a purchase.
Knowledge is power as they say…
Another thing to keep in mind with ADRs is that your gains or losses can be influenced by currency fluctuations.
Let’s say you purchase an Adidas ADR and hold for one month. Changes in the Euro and dollar over that time could increase or decrease the value of your position.
These swings are typically minimal, but also worth mentioning, as they can affect your final payout
But with those caveats aside, you should know ADRs are another great way to stream steady income from well known companies.
Even better many ADRs payout strong dividends, which like high-quality dividend stocks on U.S. exchanges, are great ways to earn easy money.
The bottom line: ADRs allows you to easily tap into an incredible pool of wealth that could bolster your income significantly.
In future issues we’ll dive deeper into ADRs and look at some of my current favorites.
Here’s to growing your wealth,
Chief Income Expert, Mike Burnick’s Wealth Watch