At any time, you can update your settings through the "EU Privacy" link at the bottom of any page. These choices will be signaled globally to our partners and will not affect browsing data. We and our partners process data to: Actively scan device characteristics for identification. I Accept Show Purposes. Your Money. Personal Finance. Your Practice. Popular Courses. Key Takeaways A company can list its shares on more than one exchange, which is referred to as dual-listing.
In order to be listed, a stock must meet all of the exchange's listing requirements and pay for all associated fees. A company might list its shares on several exchanges to boost the stock's liquidity. Multinational corporations might list on multiple exchanges, including their domestic exchange and the major ones in other countries. Article Sources. Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts.
We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.
Compare Accounts. The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace. Related Articles. International Markets ADR vs. This makes the stock price more reliable. The more people who are trading the stock, the less likely it is to be mispriced. The final advantage is more trading time.
If a stock is listed on exchanges in different time zones, it will be tradable throughout the day instead of just while one of the exchanges is open. However, this is unimportant for many businesses because most exchanges allow some form of after-hours trading. The pros, as outlined above, are access to capital with new stock offerings and more stock trading volume. The cons are mostly related to cost. Listing on multiple exchanges comes at a price. The custodian bank holding the trust when a company goes the ADR route has to be paid, and the entity needs to be structured and updated by lawyers.
If the business doesn't dual-list via an ADR, there will be massive costs to state financials under SEC regulations and comply with all other exchange rules. Additionally, when the company is taking advantage of a stock trading on multiple exchanges by issuing more shares, the management team will need to travel to those locales. In the U. Foreign companies may find it beneficial to hold multiple shareholder meetings as well.
All in all, the cons of dual-listing are likely immaterial to multinational corporations looking to raise hundreds of millions or even billions of dollars.
On a micro level, dual-listing does not affect stock prices. The prices on the different exchanges will be the same when you account for currency differences and transaction costs. Over time, having a more liquid stock and the ability to raise more capital for growth could help the stock price go up — but that would only occur if the fundamentals of the business were also getting better.
Dual-listing is a big plus for U. Outside of that feature, it likely won't significantly affect the stocks that you buy over the long term. Liabilities associated with listing requirements such as warranties, indemnities and ongoing obligations. Liaising for cross-market releases. Processes are put in place to make and monitor public announcements. Potential changes to the board of directors, company constitution and corporate governance considerations.
Potential time demand on management. Potential concerns following Brexit There has been concern that Brexit may affect EU recognition of UK public markets and therefore restrict trading in shares listed in both London and elsewhere in the EU. Conclusion A dual listing in the UK is an obvious choice for any listed company with an international business or asset base that is looking to increase its global presence and investor base.
Trainee Simon Jennings also contributed to this article. Keep in touch. Looking for someone? Generic filters Hidden label. Hidden label. Looking for an Office? The issuer must control the majority of its assets and have done so for at least 3 years. Ongoing obligations. Yes, reverse takeovers and transactions representing a fundamental change of business require approval. No, all notifications made by the issuer in the previous 12 months must be available on its website.
More liquidity and increased ability to raise funds or use shares for acquisitions. No minimum market capitalisation. Working capital available to the company must be sufficient for its present requirements for at least 12 months. Less stringent admission criteria.
Continuing obligations are generally less restricted and easier to comply with than most primary markets.
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