what was a holding company depository receipt holdr 
a holding company depository receipt holdr was a security that allowed investors to buy and sell a basket of stocks in a single transaction like exchange traded funds etfs holdrs allowed investors to trade stocks in a specific industry sector or group etfs however provide a more efficient and flexible structure for investors and issuers as a result holdr securities were discontinued and some converted into etfs by the end of the year 2011 understanding holding company depository receipts holdrs a holding company depository receipt holdr referred to a fixed collection of publicly traded stocks packaged together as one security holdrs were created by merrill lynch and traded only on the new york stock exchange nyse holdrs enabled an investor to gain exposure to a market sector at a relatively low cost and diversify within that sector to gain the same level of diversification manually the investor would have needed to purchase each company individually thus increasing the amount paid in commissions 1holdrs covered a wide range of sectors and industries such as biotech pharmaceutical and retail but merrill lynch determined the composition of each holdr and holdrs can vary widely from each other a key difference between holdrs and etfs was that investors in holdrs had direct ownership in the underlying stocks which is not the case for etfs and as a result investors in holdrs had voting and dividend rights etfs and the demise of holdrsholdrs are often lumped in with exchange traded funds etfs and while both products share low cost low turnover and tax efficient characteristics they are different investment vehicles etfs are often preferable to investors and meet the same purpose as holdrs etfs invest in indexes that contain many components and regularly change in contrast a holdr was a static group of stocks selected from a particular industry and their components rarely change etfs also track some form of an underlying index whereas holdrs did not etf holdings are moreover managed and periodically adjusted to provide the best return possible within that index if a company was acquired and removed from a holdr its stock was not replaced which could result in more concentration and added risk holdrs were typically bought in round lots of 100 and could be quite capital intensive for smaller investors thus excluding some from participating in them holdrs however helped give rise to the popularity of etfs whose dominance eventually consumed some holdrs and caused others to be shut down and liquidated in december of 2011 six of the 17 remaining holdrs were converted into etf structures and the remaining 11 were liquidated 2