What is CA in stock rising, and why do investors need to know?

When you enter a stock trading platform, you may notice mysterious characters appended to stock names, such as CA, XM, XD, XN, and many others. The natural question is: what do these symbols mean, and why are they important for your investment decisions?

Understanding the symbols CA and its related abbreviations is essential for investors of all levels, as these symbols indicate significant upcoming changes affecting the stock.

CA: Upcoming Corporate Actions

CA stands for “Corporate Action,” which means “Company Action.” When you see the CA symbol appear after a stock, it indicates that the stock will undergo a major change within the next 7 days.

Clicking on the CA symbol allows you to view details about the upcoming change, such as the date and nature of the event. This information is displayed in abbreviations, which can be grouped into three main categories.

Group 1: Symbols starting with X – Rights You Will Lose

All symbols beginning with the letter X have the same meaning: “Excluding,” which translates to “not including” or “rights not received.”

XD – Disqualification of dividend rights

XD stands for “Excluding Dividend.” If you purchase the stock after the XD mark appears, you will not be entitled to receive the dividend for that period. However, if you buy the stock just one day before the XD date, you still retain the right to dividends.

The way to receive dividends is simple: you must own the stock before the XD date, regardless of when you buy during that period. The dividend rate is the same for all.

XM – Shareholder Meeting Rights

XM stands for “Excluding Meetings.” When this symbol appears, buyers of the stock after the XM date will not be able to participate in the company’s shareholder meetings.

XW, XS, XR – Other rights lost

• XW (Excluding Warrant): You will not receive warrants, which are rights to convert into the main stock at a specified rate, usually 1:1.
• XS (Excluding Short-term Warrant): No rights to subscribe for short-term warrants.
• XR (Excluding Rights): No rights to subscribe for new shares, often capital increase shares issued to existing shareholders to raise funds.

XT, XI, XP, XA, XE, XN, XB – Other rights

• XT (Excluding Transferable Subscription Right): Rights to purchase additional shares, which can be transferred.
• XI (Excluding Interest): No interest received.
• XP (Excluding Principal): No principal repayment.
• XA (Excluding All): No rights to any upcoming company announcements.
• XE (Excluding Exercise): No rights to convert securities into shares.
• XN (Excluding Capital Return): No capital reduction refunds.
• XB (Excluding Other Benefits): No rights to subscribe for other types of shares, such as preferred shares or securities of affiliated companies.

Group 2: Symbol T – Warning Levels for Speculation

The T symbols appear when stock prices rise rapidly. The stock exchange implements measures to limit such volatility, categorized into three levels.

T1: First warning level

T1 stands for “Trading Alert Level 1.” At this level, you must buy stocks using a Cash Balance account only. This symbol remains for 3 weeks after announcement.

T2: Second level with additional restrictions

T2 stands for “Trading Alert Level 2.” If a stock remains under warning after less than one month from the T1 announcement, it escalates to T2. At this level, you must use a Cash Balance account and cannot use stocks as collateral. The T2 period also lasts 3 weeks.

T3: Highest restriction level

T3 stands for “Trading Alert Level 3.” If the stock remains under T2 conditions for no more than one month after the announcement, it escalates to T3. Additional restrictions include no netting. (Settlement) means that after selling stocks, the buying power returns the next day instead of immediately. This prevents multiple trades within a single day.

Note: Cash Balance accounts are suitable for beginner investors, as they can only invest up to the amount of money in the account. This is a natural way to limit investment risk.

Group 3: Warning Symbols

These symbols are designed to alert investors to potential risks.

H and SP: Trading Halt

• H (Trading Halt): Temporary trading suspension for one session. (There are two sessions per day: morning and afternoon.) Usually occurs when some news leaks before official announcement.
• SP (Trading Suspension): Multiple trading halts, possibly due to similar reasons as H or if the company fails to submit financial reports.

NP and NR: Pending or received notices

• NP (Notice Pending): The company has some information to report to the stock exchange.
• NR (Notice Received): The exchange has received clarification from the company.

NC: Non-compliance

NC stands for “Non-Compliance.” The company is at risk of delisting due to severe losses or prolonged failure to submit financial statements. The company has 1 year to rectify the issue and remove this mark.

ST: Price stabilization

ST stands for “Stabilization.” A common method used by companies is to issue an IPO exceeding the target amount and use the excess shares to support the price, preventing it from falling below the IPO price during the first 30 days.

C: Most dangerous symbol

C stands for “Caution.” The company faces serious problems and high financial risk due to one of the following reasons:

Financial issues:

• Shareholders’ equity less than 50% of paid-up capital
• Court orders reorganization or bankruptcy
• Regulatory authorities require corrective actions or suspension of certain operations

Financial statement issues:

• Auditors express no opinion
• SEC orders financial corrections

Business issues:

• The company becomes a Cash Company (after selling nearly all assets, leaving only cash and short-term securities)

Summary: Why are CA and related symbols important?

Understanding the CA symbol and related abbreviations is fundamental for all investors. These symbols indicate upcoming changes or risky events. If you do not understand their meanings, you may make investment decisions without full information.

Therefore, noting these symbols is not just decorative; they are strategic data that help you understand the situation and make informed, wise decisions.