View the top 10 well-liked foreign stock ADRs and some crucial investment considerations before purchasing.
Well-Known And Prosperous International Businesses
Bundles of foreign stocks that are traded on the American market are known as American depository receipts. Many American depository receipts include supplies from well-known and prosperous foreign corporations. ADRs also carry the risks associated with inflation, exchange rates, and politics.
What Do ADRs Do? 
In essence, American depository receipts are domestic stocks traded in overseas markets. They are a well-liked method for American investors to invest in international businesses. When U.S. banks buy a large number of shares from a company, aggregate them together, and resell them on a U.S. stock exchange, ADRs are produced. The bank then adjusts the proportion of U.S. ADRs to overseas shares to guarantee that the ADRs are priced correctly in American businesses.
The Top 10 International ADRs
The top 10 international firms with the highest trading volume on American exchanges are shown below. This information was most recently updated on October 24, 2021, and comes from J.P. Morgan's ADR Directory.
Arabian Group (BABA)
Alibaba Group Holdings Ltd., a firm with headquarters in China, engages in online and mobile commerce by providing goods, services, and technology within and beyond the People's Republic of China. According to J.P. Morgan, its market worth is $3.72 billion. The New York Stock Exchange lists the ADR (NYSE).
NIO (NIO) 
Chinese automaker NIO specializes in creating brand-new electric automobiles. The business was established in 2014 and first went public in 2018. 12 It trades on the NYSE in America with a market capitalization of $1.11 billion.
A company that manufactures semiconductors in Taiwan (TSM)
This business is a Taiwan-based manufacturer of semiconductors, as the name would imply. It was founded in 1987 and today produces thousands of goods for hundreds of clients. 3 It trades on the NYSE, just like the other two stocks mentioned thus far, and has a market value of $725.45 million.
JD.Com (J.D.)
JD.Com, a China-based e-commerce business and a direct rival of Alibaba, focus on direct online sales of general merchandise, home appliance products, and electronics. However, JD.com trades on Nasdaq rather than the NYSE, in contrast to Alibaba. It has a $490.79 million market value.
Baidu (BIDU)
Baidu, China's top search engine and early adoption of A.I. technology, creates new A.I. businesses.
4 On the Nasdaq, it is worth $547.97 million in trading.
Nokia (NOK)
Nokia is a global supplier of network hardware, software, services, and licencing options. Nokia is a Finnish technology corporation. It has a market value of $112.40 million and is traded as an ADR on the NYSE.
Pinduoduo (PDD)
This ADR, another Chinese e-commerce business, uses a mobile marketplace to link local communities with Chinese agricultural growers. It is traded on the Nasdaq and has a $1.04 billion market cap.
AstraZeneca (AZN)
Americans can now participate in the British-Swedish pharmaceuticals company AstraZeneca thanks to its NYSE-listed ADR. Its activities include developing, commercializing, and discovering prescription drugs, including vaccines. It is worth $247.26 million in trading.
Bilibili, Inc. (BILI), a full-spectrum video community with sections for lifestyle, games, entertainment, anime, tech, and knowledge caters to youthful generations in China. On the Nasdaq, this ADR has a transaction value of $209.33 million.
ASML (ASML)
This Dutch semiconductor producer is the final company on the top ten most popular ADRs list. The business, established in 1984, is physically present in over 60 organizations, giving it access to a broad spectrum of potential clients. 5 It is traded on the Nasdaq and is worth $1.04 billion.
What proportion of my portfolio should be made up of foreign stocks?
Many financial gurus advise keeping your investment in foreign equities to a small fraction of your overall holdings. You may want to invest up to 20% of your money in international stocks as part of your broad stock exposure. As with any portfolio balance, thoroughly analyze your objectives, level of risk tolerance, and financial circumstances before making any decisions. Do not just adopt a general rule of thumb.
Do foreign equities typically increase when American stocks decline?
Although international stocks may offer some degree of diversification, diversification should not be confused with negative correlations. Global equities are useful for diversity since they normally move in broadly comparable directions to domestic stocks, albeit they may not always do so or may do so with a different level of volatility. Foreign equities are not the best hedging strategy since they do not always move exactly in the opposite direction of domestic stocks.
