Nintendo is a brand familiar to every American. But its business operations are less well known, perhaps simply because it's a Japanese firm not directly trading on U.S. exchanges like the Nasdaq.

After a few tough years in the mid-2010s, a new game console, the Nintendo Switch, became a breakout product for the company. Over the five years up to and including 2023, Nintendo's net income averaged $3.22 billion, with the company having a market capitalization of about $67 billion in early 2024.

These numbers may make American investors keen to invest 🐻in Nintendo short of opening foreign accounts in Tokyo or Osaka, where its stock tꦛrades. Below, we detail how American investors can speculate on Nintendo stock.

American Depositary Receipts

U.S. investors can buy Nintendo stock by purchasing ADRs traded over the counter in the U.S. or its foreig𓃲n stock traded in U.S. dollars over the counter as well.

ADRs are not as well known as stocks, although they've been around since 1927. A single ADR most often represents one share but can stand for multiple or fractions of🅘 shares.

ADRs are administered by banks or brokerages and are sold to investors who want to hold shares of foreign corporations to diversi💝fy their por🍒tfolios while avoiding the costs, bureaucratic hurdles, and taxes associated with directly holding stock in foreign companies.

Two Choices

U.S. investors can buy a Nintendo ADR traded 澳洲幸运5官方开奖结果体彩网:over the counter with the ticker symbol NTDOY. One NTDOY ADR represents one-fourth of a Nintendo share traded in Japan. Thus, a U.S. investor 🌸needs to buy four units of NTDOY to equal o♑ne ordinary share of Nintendo.

Another option is to buy Nintendo foreign or "F" shares in the U.S. over the counter. The ticker symbol is NTDOF. One NTDOF share equals one ordinary share of Nintendo traded in Japan, but is traded in U.S. dollars.

U.S. investors should keep in mind the exchange rate between the U.S. dollar and the Japanese yen when purchasing Nintendo ADRs. As of Feb. 2, 2024, one U.S. dollar equaled 148.38 Japanese yen. NTDOY, the Nintendo ADR worth🌠 about one-fourth of the Nintendo foreign stock traded in the U.S., closed Feb. 2, 2024, at $14.29. Meanwhile, NTDOF, the Nintendo "F" shares, closed at $56.67 the same day, making them worth about 8,409 yen.

NTDOY Vs. NTDOF

Choosing between NTDOY and NTDOF is inherently choosing between ADRs and F sha🥂res. Thus, investors should think about the convenience and accessibility of ADRs versus the direct ownership and potential complexities with F shares.

ADRs versus F Shares

ADRs and 🐓F shares are both ways to invest in the Japanese company through the U.S. stock market, but there are key differences:

• Issuance: ADRs are issued by U.S. depositary banks, and each ADR represents one or more shares of a foreign stock or a fraction of a share. When investors buy an ADR, they technically own the shares in the foreign company, but the actual shares are by a U.S. financial institution overseas. F shares are foreign stocks traded in the U.S. market but are not issued by a U.S. depositary bank. F shares trade in U.S. dollars and are subject to the regulations of both the U.S. and the home country.
• Investor considerations: ADRs allow U.S. investors to buy shares in foreign companies without the complexities of dealing with foreign stock exchanges, currency conversion, and certain regulations. They provide easier access to financial information and are quoted and pay dividends in U.S. dollars. However, while F shares offer direct ownership in a foreign company, they may come with additional risks because of differences in accounting standards, corporate governance, and potential foreign tax implications.

The Bottom Line

U.S. investors can buy Nintendo stock either through ADRs or F shares. Nintendo's ADRs, trading under the ticker symbol NTDOY, are a convenient option, allowing investors to buy shares in the company on U.S. stock exchanges without the complexities of foreign exchange and international market regulations. These trade at about one-fourth the value of full shares and often have greater liquidity. Alternatively, investors can opt for Nintendo's F shares, traded in U.S. dollars and equal to one ordinary share of Nintendo.