In April 2026, Brazil's Ibovespa is hovering near 200,000 points and foreign capital inflows have accumulated R$ 65 billion year-to-date. The local market is performing well, but that doesn't eliminate the case for international diversification. The practical question many Brazilian retail investors face is straightforward: how do you access Apple, NVIDIA, Amazon, Tesla, or Google without opening a foreign brokerage account, without wiring dollars abroad, and without navigating foreign regulation?
The answer has existed since 2009 and is listed on B3 itself: the BDR, Brazilian Depositary Receipt. But it's an instrument that still generates confusion. It's not a stock. It's not an ETF. And the tax rules have specific wrinkles that matter. Understanding what it is, how it works, what the real costs are, and where it fits — or doesn't — in a portfolio is worth the time.
What a BDR Is and Why It's Not the Same as Owning the Original Stock
A BDR is a certificate traded on B3 that represents shares of a foreign company held in custody abroad. When you buy AAPL34 (Apple), NVDC34 (NVIDIA), or TSLA34 (Tesla) through your Brazilian broker's trading platform, you are not buying the stock directly on Nasdaq. You are buying a receipt issued by a depositary institution in Brazil, which in turn holds the original shares locked up with a custodian institution abroad.
The mechanics work as follows: the depositary institution acquires the foreign company's shares in the overseas market. Those shares are blocked at an international custodian. The depositary then issues BDRs on B3, backed by those shares, in a ratio that varies by program — for example, 1 BDR might represent 1/6 of an original share, depending on the price and program design.
That backing is real: each BDR corresponds to a genuine fraction or multiple of shares held in custody. Liquidity, however, depends on the Brazilian secondary market — not on the liquidity of the original stock on Nasdaq or the NYSE.
Types of BDR: Sponsored and Non-Sponsored
The classification of BDRs has practical consequences for investors.
Non-Sponsored BDR (Level I): The vast majority of BDRs available on B3 are non-sponsored. This means the initiative to list the receipt in Brazil came from one or more depositary institutions, without the participation of the original issuing company. Apple, for example, did not actively participate in the AAPL34 program. This doesn't invalidate the product — the backing in shares is genuine — but it does mean the company has no obligation to provide regulatory information in the format required by the CVM (Brazil's securities regulator).
Sponsored BDR Level I: The foreign company participates in the program and contracts the depositary. There were historically restrictions on which investors could access this level, but following CVM regulatory changes in 2020, access was extended to individual retail investors broadly.
Sponsored BDR Level II: Distributed through restricted public offerings. The company follows stricter disclosure standards with the CVM.
Sponsored BDR Level III: Allows broad public offerings. The issuing company files a prospectus with the CVM and can raise capital in the Brazilian market. Codes end in 33 (e.g., NUBR33, Nubank's BDR).
For retail investors buying BDRs of American companies in the secondary market, the most relevant practical distinction is between sponsored and non-sponsored — particularly regarding access to company information.
BDR Liquidity in 2026: A Market That Grew Eight Times Over
The average daily trading volume of BDRs on B3 reached close to R$ 1 billion in 2025, according to B3's own data. For context: in 2020, when the CVM opened the product to retail investors, volume was a fraction of that figure. Growth was approximately eight times over five years, and the number of investors reached 996,000 in October 2025.
The most actively traded BDRs by average daily volume are consistently dominated by the American technology sector's "Magnificent Seven":
| Ticker | Company | Average daily volume (2025) |
|---|---|---|
| TSLA34 | Tesla | R$ 131 million |
| NVDC34 | NVIDIA | R$ 115 million |
| INBR32 | Banco Inter | R$ 82 million |
| AAPL34 | Apple | High volume |
| MSFT34 | Microsoft | High volume |
| AMZO34 | Amazon | High volume |
| GOGL34 | Alphabet (Google) | High volume |
B3 also offers options contracts on a selected list of BDRs, including AAPL34, AMZO34, MSFT34, NVDC34, and TSLA34 — which signals liquidity sufficient to support derivatives markets.
That said, BDR liquidity is structurally lower than the original shares in the United States. During market stress, bid-ask spreads can widen. For investors operating with large volumes or requiring precise execution within tight windows, this is a meaningful constraint.
Taxation: What Applies, What Doesn't, and What Most People Get Wrong
BDR taxation has two main components: capital gains tax on sales and income tax on dividends received.
Capital gains: The rate is 15% for regular trades (swing trade) and 20% for day trades, applied to profits. Payment is made monthly via DARF, by the last business day of the month following the trading month. Here is a critical point that distinguishes BDRs from direct Brazilian stock positions: the R$ 20,000 monthly exemption that applies to capital gains from stock sales does not apply to BDRs. Every gain from selling a BDR is taxable, regardless of the total amount sold in a given month. Investors who buy BDRs and assume the stock exemption threshold applies are making an error with real audit risk.
Dividends: Foreign companies distribute dividends to BDR holders following the original company's payment calendar and dividend policy. The tax on BDR dividends is 15%, payable by the investor. For American companies specifically, the United States withholds 30% at the source. Under the international agreement to avoid double taxation, if the tax withheld abroad is greater than the 15% owed in Brazil, no additional tax is due in Brazil. In practice, investors receiving dividends from BDRs of American companies typically have no additional tax to pay in Brazil — but must declare the amount received in their annual income tax return.
IOF and remittances: There is no IOF on foreign remittances because the investor remits nothing — purchases and sales happen in reais, on B3, exactly like any domestic stock transaction.
Annual tax return: BDRs must be declared in the Assets and Rights section, group 04 (Investments), code 04 (Assets traded on Brazilian exchanges).
The B3 BR+ Index: When the BDR Becomes the Benchmark Itself
In August 2024, B3 launched the Ibovespa B3 BR+ index, a benchmark combining Ibovespa stocks with BDRs of Brazilian companies listed abroad. The logic was to include in Brazil's main market reference companies that chose to list their shares on American exchanges for strategic reasons, while maintaining operations and customer bases primarily in Brazil.
The index's inaugural composition included the BDRs of five companies: Nubank (NUBR33), Stone (STOC31), XP Investimentos (XPBR34), PagSeguro, and Banco Inter. Nubank holds the second-largest weighting in the index at 7.14%, behind only Vale. The index rebalances in January, May, and September.
This creates an interesting situation: investors in passive funds that replicate the B3 BR+ already have indirect BDR exposure — even without having purchased a single BDR directly.
BDR vs. International ETF: Using IVVB11 as a Reference
The main international equity ETF available on B3 is IVVB11, which tracks the S&P 500. The comparison between individual BDRs and IVVB11 clarifies which profile each product suits:
| Criterion | Individual BDR (e.g., AAPL34) | International ETF (e.g., IVVB11) |
|---|---|---|
| Exposure | One specific company | 500+ companies (index) |
| Active selection required | Yes | No |
| Management fee | None (cost via spread) | ~0.1% p.a. (IVVB11) |
| Dividends | Passed through to BDR holder | Reinvested in fund (IVVB11) |
| R$ 20k exemption | Does not apply | Does not apply |
| Dividend taxation | 15% (paid by investor) | Incorporated into NAV |
Investors who want diversification with operational simplicity and low monitoring costs tend to benefit from the ETF. Those who want concentrated exposure to a specific company — NVIDIA based on conviction in the AI sector, for example — use the BDR for that purpose.
BDR vs. Direct Overseas Account: Avenue and Similar Platforms
In recent years, platforms like Avenue, Stake, and Nomad have simplified the process of opening American brokerage accounts for Brazilian investors. A direct comparison with BDRs reveals real trade-offs:
Overseas account: Direct access to the original stock with full Nasdaq/NYSE liquidity. IOF of 0.38% on dollar remittances. Income tax declared as an overseas asset (separate section in the annual tax return, with different capital gains rules for amounts above R$ 35,000). Greater bureaucratic complexity. Access to options, fractional shares, and other instruments.
BDR: Zero IOF. Simplified declaration alongside other domestic assets. Same broker and same trading platform. Potentially wider spreads during low-liquidity periods. Limited access to special equity programs (stock splits may take time to be reflected; buybacks do not directly benefit BDR holders).
Neither option is superior in absolute terms. For smaller portfolio sizes and investors who want to keep everything on a single platform in reais, BDRs reduce operational friction significantly.
Risks the Investor Needs to Understand Before Buying
Exchange rate risk: BDRs are traded in reais, but their value is tied to the foreign stock's dollar price. If the dollar falls against the real, the BDR may underperform the original dollar-denominated stock even if the American company appreciated. The reverse is also true: a weakening real amplifies gains in reais terms.
Liquidity risk: During stress periods, spreads widen. BDRs with lower average daily volume may have more expensive execution.
Concentration risk: Buying a single company's BDR replaces diversification with conviction — which requires analysis. Buying BDRs across the Magnificent Seven as an "international diversification" strategy still results in concentration in large-cap American technology.
Information risk: Non-sponsored BDRs carry no obligation from the original company to provide information in the CVM's required format. Investors depend on disclosures published in the original markets (the SEC for American companies), frequently in English.
Regulatory risk: Changes in CVM rules or alterations in tax treaties between countries could change the fiscal treatment of BDRs.
The 2026 Context: International Diversification Remains Relevant Even with Ibovespa at All-Time Highs
With the Ibovespa near 200,000 points and foreign inflows at R$ 65 billion in 2026, the local market is clearly in a favorable period. But international allocation is not a contrarian bet against Brazil — it's structural protection against concentration in a single economy, currency, and political cycle.
The real has appreciated significantly in recent years. That appreciation, while improving purchasing power, reduces returns in reais for investors holding dollar-denominated assets. A portfolio that includes BDRs or international ETFs captures potential gains when the cycle reverses.
BDRs are a legitimate instrument for that diversification. They are not perfect — the effective cost via spread exists, the tax treatment has nuances that require attention, and liquidity is lower than the original shares. But the access they provide to companies like Apple, NVIDIA, Amazon, and Microsoft through a Brazilian trading platform, without IOF and without a foreign brokerage account, is real and functional for retail investors with mid-size portfolios.
At Royal Binary, Sidnei Oliveira and the trading team monitor both the domestic market and movements in major American companies that drive global capital flows. If you want to understand how we complement international allocation strategies with managed trading, explore our platform.