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Anyone know exactly what's the deal with the Y-suffixed versus the F-suffixed OTC listings for foreign companies?
Some non-US companies elect to list their shares on one of the US exchanges (NYSE, NASDAQ etc) as their primary/home exchange. Other companies' shares are primarily listed and traded on their home exchange (Hong Kong, Tokyo, Toronto, or wherever), but sponsor an ADR which is listed on a US exchange - this apparently requires the company go through some paperwork process to make this happen. Most non-US companies do not have any listing on the main US exchanges. For many of these, enterprising investment bankers have set up unsponsored ADRs, which are generally traded on the OTC market, which is managed/run/whatever by a company called OTC Markets Group, which is the "Pink Sheets" company. One can usually tell these OTC listings because the symbols are 5 letters. And finance sites like Yahoo! require that you suffix the symbol with ".PK" as well, resulting in tickers like DFIHY.PK and COSWF.PK. But we all knew all that.

Most of the OTC listings for stock in non-US companies have 5-character symbols that end in either Y or F. The OTC Markets website say that Y symbols are for ADRs, while the F suffix denotes a foreign stock. But I'm kinda perplexed, since a few companies have only a Y symbol (DFIHY, SUTNY, etc), and some (KHDHF, SCPZF, VEMTF, etc) have only an F symbol, and many (FRCOY/FRCOF, BYDDY/BYDDF, WMMVY/WMMVF, etc) have BOTH. In such cases, I can go to E*Trade etc, and trade either of these. In my experience, if there's both a Y and an F symbol, then the Y symbol is a lot more liquid. So what *is* the F listing, if it's not an ADR? It's clearly not actually routing trades through to the home exchange, since that exchange isn't generally even open during US trading hours. So it's just some ADR-like thing, that's not an ADR? I go to, and enter an OTC ticker symbol, and hit the "Company Info" tab, and it tells me that KPELY is "OTC Pink Current / Sponsored ADR - Ratio: 1 ADS = 2 Ordinary." And it tells me that KPELF is an
"OTC Pink Current / Ordinary Shares." But that doesn't tell me much, to be honest.

With an ADR (to greatly simplify - I suspect the details are actually messier than this), some investment banker (often JP Morgan or Bank of NY Mellon) sets up a shell corporation, sells a zillion shares in this corporation and exchanges the proceeds of that sale into some foreign currency, which is used to buy X zillion shares of the foreign-listed company's stock. Those company shares are deposited into a vault. Whenever the foreign company pays a dividend, the ADR-shell-corporation exchanges the dividend into USD, skims off a little for their profit, and divvies up the rest to the holders of the ADR shares (ADSs). If the foreign company doesn't pay dividends, then the ADR just sends a bill to each ADR shareholder (via their broker) and gets their profit that way. The ADR banker frequently buys more foreign shares and issues more ADR shares, or vice-versa, to arbitrage away any imbalance between the foreign shares and the ADS. Please feel free to correct me on any misunderstanding/misconceptions about this.
So, fundamentally, I buy shares in an ADR because I have some confidence that there really *IS* a bank vault somewhere which holds a stock certificate for my shares in the foreign company. What about the "non-ADR" F-suffixed OTC symbol?? I hope that the F ticker is (like an ADR) actually tied to some stock certificates in a vault somewhere. But if that's the case, then how's it different from an ADR? When I tell E*Trade to take a big chunk of my USD cash and turn it into shares in SCPZF, what the heck *is* SCPZF??!

On a related note... For unsponsored ADRs, the investment banker sets up the ADR and buys the foreign company shares on the home exchange without involvement (or permission or whatever) of the foreign company itself. There's nothing to stop another investment banker (or six) from doing the same thing. For such unsponsored ADRs that are issued by more than one depositary bank, does anyone know if all of the different banks' ADRs trade under the same symbol? Do I have any way of knowing which ADR I've actually bought? Did, say, Goldman-Sachs do ADRs, prior to 2008? And how did that go for people?

Sorry if this seems a pointless bunch of trivia questions. But it's hard sometimes not to lose sight of the idea that I'm buying a fractional share in a business, rather than just tallying up unpronouncable strings of letters. And it becomes even harder when I can't even claim to know what the heck I'm actually buying.
So thanks for any and all insight.

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