Why is it important to recognize the CA symbol when trading stocks?

When you start trading stocks through the Traang application, you will see various symbols appearing behind the stock names, such as CA, XD, XM, T1, H, SP, etc. These symbols are not just abbreviations without meaning but serve as important signals indicating the status and upcoming events related to that stock. Understanding these symbols is a fundamental skill for both novice and experienced investors.

Meaning of CA and Stock Movements

CA stands for Corporate Action, which means actions taken by the organization or company. When a stock has the CA suffix, it indicates that significant activities will occur with that stock within the next seven days. Investors can click to check more details to understand what event is about to happen.

Stock suffix symbols can be divided into three main categories based on the nature of the action and its impact on shareholders’ rights. Each category has different characteristics and significance.

X-family Symbols: Rights That Shareholders Will Not Receive

Symbols starting with the letter X mean “Excluding,” indicating that if you buy the stock when this symbol appears, you will not be entitled to the benefits announced by the company.

XD - No Dividend Rights

XD stands for Excluding Dividend. If you buy the stock during the XD period, you will be excluded from receiving dividends for this round. However, if you hold the stock until the next XD, you will be entitled to dividends in the following cycle. Shareholders who buy before the XD date will all receive dividends at the same rate.

Many wonder how long they need to hold the stock to qualify for dividends. The answer is you can buy the stock just one day before the XD date and still receive dividends just like long-term holders.

XM - No Rights to Attend Shareholders’ Meeting

XM stands for Excluding Meetings. When a stock shows XM, you cannot attend the shareholders’ meeting, which is where the company’s owners delegate authority and make decisions about the company’s management.

XW - No Rights to Warrant Subscription

XW stands for Excluding Warrant. When a stock shows XW, investors will not have the right to subscribe for warrants, which are rights to purchase shares at a specified price and period. Usually, the exercise ratio is 1:1 or as set by the company. If you want to convert warrants into common shares, you will need to pay additional money according to the specified price.

( XS - No Rights to Short-term Warrant Subscription

XS stands for Excluding Short-term Warrant. This means shareholders will not have the right to subscribe for short-term warrants.

) XR - No Rights to New Share Subscription

XR stands for Excluding Rights. When a stock shows XR, investors will not have the right to subscribe for new shares. This usually occurs when the company needs to raise capital, often for expansion and business development. The company invites existing shareholders to invest further to maintain their ownership proportion.

XT - No Transferable Subscription Rights

XT stands for Excluding Transferable Subscription Rights. This means you will not receive the rights to subscribe for additional shares, which are issued to raise funds. These new shares have the same rights as existing shares.

XI and XP - No Interest and No Principal

XI stands for Excluding Interest, and XP stands for Excluding Principal. These abbreviations often appear in fixed-income instruments, indicating you will not receive interest or principal payments.

XA - No Rights at All

XA stands for Excluding All. This indicates you will lose all rights that the company is announcing. Investors can click to see more details about what will be announced this time.

XE - No Convertible Rights

XE stands for Excluding Exercise. This means you will not have the right to convert the instrument into underlying shares.

XN - No Capital Return

XN stands for Excluding Capital Return. When a stock shows XN, investors will not receive a return from capital reduction. Capital reduction is a way to improve the company’s financial position, especially if it has accumulated losses over a long period. It helps reduce or eliminate accumulated losses.

XB - No Other Benefits

XB stands for Excluding Other Benefits. This appears when the company allocates preferred shares to common shareholders or allocates common shares to preferred shareholders. It may also include offering securities of affiliated companies to existing shareholders.

T-family Symbols: Price Volatility Warnings

Symbols starting with the letter T indicate that the stock has experienced significant upward movement, with high speculation. The stock exchange implements measures to limit the rapid rise of such stocks. The warning levels are divided into three stages:

T1 - First Warning Level

T1 stands for Trading Alert Level 1. When a stock hits T1, buyers must use a Cash Balance account for purchases only. The exchange will mark this for 3 weeks from the announcement date.

T2 - Second Warning Level

T2 stands for Trading Alert Level 2. If a stock remains on T1 after one month of measures, the level will escalate to T2. Investors must use Cash Balance accounts only and are prohibited from using this stock as collateral in any account. The exchange marks this for 3 weeks.

T3 - Highest Warning Level

T3 stands for Trading Alert Level 3. If a stock remains on T2 after one month, it escalates to T3. Investors must buy only with Cash Balance accounts, cannot use the stock as collateral, and cannot offset trades. ###Settlement### means that when you sell the stock, the proceeds will not be available immediately but will be settled the next day. This measure helps limit repeated trading within the same day.

Cash Balance accounts are suitable for novice investors because they can only invest with the funds available in their account, making it easier to understand and limiting investment amounts.

Other Warning Symbols: Caution for Investors

Besides X and T symbols, there are other symbols used to warn investors about financial, accounting, or company status issues.

( H - Trading Halt

H stands for Trading Halt. When a stock shows H, trading is temporarily suspended for one trading session. )Each day has 2 sessions: morning and afternoon.### This usually occurs when certain news is released to the public but the company has not yet officially filed with the stock exchange.

( SP - Long-term Trading Suspension

SP stands for Trading Suspension. When a stock shows SP, trading is halted for more than one session. Causes may be similar to H, such as pending news not yet disclosed to the exchange, or the company not submitting financial statements.

) NP and NR - Notice Pending and Notice Received

NP stands for Notice Pending, meaning the company has some matter pending with the stock exchange. Once the company submits the required documents, NR (Notice Received) indicates the exchange has received the clarification.

NC - Non-Compliance

NC stands for Non-Compliance. It indicates the company does not meet the criteria for continued listing, such as prolonged accumulated losses or failure to submit financial statements on time. When a company is NC, it has one year to rectify the issues.

ST - Price Stabilization Step

ST stands for Stabilization. This stock is maintaining price stability. A common method is for the company to issue an IPO ###during the first trading period### exceeding the set amount to support the price and prevent it from falling below the IPO price during the first 30 days.

( C - Risk Warning Signal

C stands for Caution. When a stock shows C, it indicates the company has problems and high financial risk. This is a serious warning for investors to avoid this stock. The company may be marked with C if it meets criteria such as:

Financial status: Shareholders’ equity less than 50% of paid-up capital, court-approved rehabilitation, or regulatory orders to correct financial position.

Financial statements: Auditor’s disclaimer due to scope limitations, or SEC)Securities and Exchange Commission### orders to amend financial statements.

Business nature: The company is a Cash Company or has sold most or all assets.

Summary: The Importance of Recognizing CA Symbols and Abbreviations for Prudent Investment

These symbols play a crucial role in providing information to investors. CA indicates that an event is upcoming, and you can easily check details. However, since these events are often represented by abbreviations, understanding their meanings is very important. Before making buy or sell decisions, studying these symbols and abbreviations will help you better understand events that could impact your investments.