BMO launches five new CDRs today, giving Canadian investors exposure to Apple, Exxon, Boeing and Home Depot stocks

BMO continues expanding its Canadian Depositary Receipts lineup, making U.S. stock investing simpler for Canadian investors. Today, the bank launches five fresh CDRs on the Cboe Canada exchange. This latest batch opens doors to major American companies across finance, energy, defense, and retail sectors. Canadian investors can now access these U.S. stocks without currency conversion hassles or foreign exchange headaches.

What Are These New CDRs and Who Can Access Them?

The five new Canadian Depositary Receipts represent significant U.S. corporations with strong market positions. Apollo Global Management (ticker ZAPO) brings asset management expertise to Canadian portfolios. ConocoPhillips (ZCOP) offers energy sector exposure. Northrop Grumman (ZNOC) provides defense and technology diversification. Home Depot (ZHD) captures the consumer retail and housing sectors. Vistra Corp (ZVST) delivers power generation and renewable energy exposure.

Any Canadian investor with a brokerage account can purchase these CDRs through major Canadian financial institutions. Unlike American Depositary Receipts (ADRs) that trade in U.S. dollars, these CDRs trade exclusively in Canadian dollars on Canadian exchanges. This structure eliminates the need to open a U.S. dollar account or pay currency conversion fees at broker exchange rates.

How CDRs Simplify International Investing for Canadian Portfolios

Feature	CDR Advantage
Currency	Trades in Canadian dollars with notional hedge
Exchange	Cboe Canada or TSX (Canadian-based)
Entry Price	Approximately $10 CAD per unit (fractional access)
Trading Convenience	Trade during Canadian market hours through any major brokerage
Currency Risk	Built-in notional hedge reduces FX impact

Canadian Depositary Receipts address a fundamental challenge for Canadian investors: accessing international stocks without friction. BMO acts as the issuing bank, holding the underlying U.S. shares while issuing CDRs to Canadian investors. When you buy a CDR share, you’re buying a claim on one or more underlying shares held in trust.

The notional currency hedge is the game-changer. This built-in feature automatically adjusts the CDR value based on currency movements between the Canadian and U.S. dollar. You don’t need to manage currency risk yourself—it’s factored directly into the pricing structure. For long-term investors who prefer to focus on company fundamentals rather than currency speculation, this is a significant convenience.

Why Major U.S. Companies Matter for Canadian Portfolio Diversification

These five companies represent different sectors critical to balanced portfolio construction. Apollo Global Management provides exposure to asset management and financial services growth. As global wealth management expands, companies managing those assets benefit directly. ConocoPhillips connects Canadian investors to energy markets without directly tracking commodity prices.

Northrop Grumman represents defense contractors with stable cash flows and government contracts. Home Depot offers retail and housing sector exposure—crucial for understanding consumer spending patterns and construction trends. Vistra Corp provides renewable energy and power generation exposure as the energy transition accelerates. Together, these five stocks span financials, energy, defense, consumer discretionary, and utilities—offering genuine diversification benefits.

Canadian investors traditionally faced barriers accessing these stocks directly. Opening a U.S. dollar brokerage account required extra steps. Converting currency cost money at unfavorable rates. Managing foreign exchange risk meant tracking two variables instead of one. BMO’s latest CDRs eliminate these friction points while maintaining the fundamental benefit: exposure to some of America’s strongest companies.

Understanding Currency Hedging and What It Means for Your Returns

The notional currency hedge built into these CDRs warrants extra explanation because it directly impacts investment returns. When you buy a U.S. stock directly as a Canadian, your dollar return depends on two things: the stock price movement and the USD-CAD exchange rate. If the stock rises 10% but the Canadian dollar strengthens 5% against the U.S. dollar, your net return is roughly 5% instead of 10%.

CDRs handle this differently. The notional hedge means the CDR issuer prices in expected currency movements. The underlying mechanism adjusts the number of U.S. shares represented by each CDR based on daily exchange rates. In practical terms, if the Canadian dollar weakens against the U.S. dollar, you automatically get exposure to that benefit without taking additional action. Conversely, if the Canadian dollar strengthens, the hedge protects you from losses on the currency side.

This structure isn’t perfect for every investor. Some prefer pure unhedged exposure—if they believe the U.S. dollar will strengthen, they want full upside. Others want no currency exposure at all. But for most Canadian investors, the balance struck by CDRs—removing currency conversion friction while managing FX risk through a transparent, built-in mechanism—hits the sweet spot. You focus on picking good companies; the CDR structure handles the currency complexity.

Could These CDRs Reshape How Canadian Investors Access Global Markets?

BMO’s expansion of its CDR lineup from the initial launches earlier in 2025 signals growing investor demand. Every month, the bank adds new CDRs covering European companies, Asian firms, and now these U.S. sector leaders. This pattern suggests Canadian investors are recognizing the efficiency gains.

Traditional alternatives include mutual funds with underlying currency management and ETFs holding diversified baskets of international stocks. Both involve management fees and less granular control. Direct ADR investing requires U.S. dollar accounts and currency conversions upfront. CDRs represent a middle ground—individual stock ownership with institutional-grade currency management and Canadian-based trading simplicity.

If CDR adoption accelerates among Canadian retail investors, it could reshape international portfolio construction. Instead of building global exposure through mutual funds or ETFs, Canadians might mix Canadian-listed stocks with strategic CDR positions. The ability to buy Home Depot, Apollo Global Management, ConocoPhillips, Northrop Grumman, and Vistra in Canadian dollars without currency fees could become standard investment practice rather than specialty product access.

What Should Canadian Investors Consider Before Buying These Five New CDRs?

First, verify liquidity before committing significant capital. While the underlying U.S. stocks are highly liquid (especially Home Depot and ConocoPhillips), brand-new CDRs sometimes have wider bid-ask spreads initially. Check the spread—difference between asking price and bidding price—on your brokerage platform. Tight spreads indicate good liquidity; wide spreads suggest higher transaction costs.

Second, understand you’re still buying U.S. stocks, just through a Canadian wrapper. These CDRs don’t eliminate business risk or market risk. ConocoPhillips remains exposed to oil price volatility. Northrop Grumman depends on government defense spending. Home Depot correlates with housing starts and consumer confidence. The currency hedge reduces one variable; it doesn’t eliminate fundamental company risk.

Third, confirm your brokerage supports CDR trading. Major players like Interactive Brokers, TD Direct Investing, RBC Direct Investing, and others support CDRs, but smaller or discount brokers might not. Check before opening positions. Fourth, don’t confuse CDR tickers with U.S. stock tickers. Home Depot’s U.S. ticker is HD; the CDR ticker is ZHD. Searching for the wrong ticker will cause confusion.

“BMO’s CDRs trade in Canadian dollars on a Canadian exchange, giving investors exposure to international companies and greater portfolio diversification opportunities.”

— Bank of Montreal, Official Statement

Sources

• Bank of Montreal Newsroom – Official CDR launch announcement and product specifications
• BMO Global Asset Management – Educational content on CDRs vs. ADRs and currency hedging mechanics
• Cboe Canada – Canadian Depositary Receipts listing and trading information