10:46 AM EST, 01/30/2025 (MT Newswires) -- Bank of Montreal ( BERZ ) is stepping into a booming product category that offers exposure to popular global stocks while hedging against currency volatility, becoming the second Canadian bank to do so, Stephanie Hughes at Bloomberg News is reporting Thursday.

Hughes noted BMO will launch five Canadian depositary receipts in the European and Japanese markets, each to be priced at about C$10 and trade on the Cboe Canada exchange.

CDRs for Europe-listed Mercedes-Benz Group AG and Nestle SA will begin trading on Feb. 6, and of Japanese companies Toyota Motor Corp., Honda Motor Corp. and Nintendo Co. on Feb. 10, the bank said in a release.

David Hudson, managing director at BMO Global Asset Management, compared the growth of Canadian depositary receipts to the popularization of exchange-trade funds in the 2010s. "It was the beginning of what will be an incredible innovation cycle in the industry," Hudson said in an interview. "So, we think the time is right to enter. We think it is helpful for there to be more entrants in the market. We're very excited about the innovation that we think will happen over the next three to five years."

Hughes noted Canadian Imperial Bank of Commerce ( CM ) debuted the first CDRs in July 2021, listing Alphabet Inc., Amazon.com Inc., Apple Inc., Netflix Inc. and Tesla Inc. on Cboe Canada. On Monday, CIBC announced the first European CDRs.

(Market Chatter news is derived from conversations with market professionals globally, and/or from other media sources This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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