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

Have you ever wondered why sometimes when you open a stock trading platform, the stock names are followed by strange characters such as CA, XM, XD, T1, T3, H, SP and others? These characters are not just symbols; they are important indicators that reveal what kind of movement or event is happening with the stock. If you do not understand their meanings, you might make inappropriate investment decisions.

What is CA (Corporate Action)?

CA stands for Corporate Action, which is a notification indicating that “this stock will have a significant event within 7 days.” When you see CA next to a stock name, click to view details. It will tell you what the event is and when it will occur.

The suffix characters can be divided into three main groups based on their type. Let’s understand each group one by one.

Suffix X: “Excluding” (Not Entitled)

Stocks with an X suffix mean “if you buy now, you will not receive certain rights or benefits.” There are several types depending on the letter following X:

• XD (Excluding Dividend) - No dividend entitlement: If a stock shows XD and you buy it, you will not receive the dividend for this round. However, if you hold the stock until the next dividend date, you will receive that dividend normally.

  Frequently Asked Questions:

  • “How long do I need to hold to get the dividend?” → The latest is the day before the XD date; then you are entitled.
  • “If I buy at different times before XD, will the dividend be the same?” → Yes, the dividend rate remains the same.

• XM (Excluding Meetings) - Not entitled to attend shareholder meetings: Buying during the XM period means you cannot participate in the shareholder meeting.

• XR (Excluding Rights) - Not entitled to subscribe for new shares: Usually, companies issue new shares to raise capital from existing shareholders.

• XW (Excluding Warrant) - Not receiving Warrants: Warrants are derivative securities that can be converted into common shares, typically at a 1:1 ratio.

• XS (Excluding Short-term Warrant) - Not receiving short-term Warrants.

• XT (Excluding Transferable Subscription Right) - Not entitled to additional share subscription rights.

• XI (Excluding Interest) - Not receiving interest.

• XP (Excluding Principal) - Not receiving the principal repayment announced by the company.

• XA (Excluding All) - Not entitled to any rights.

• XE (Excluding Exercise) - Not converting rights into underlying shares.

• XN (Excluding Capital Return) - Not receiving capital reduction refunds.

• XB (Excluding Other Benefits) - Not entitled to other types of new share subscription rights.

T Mark: Investor Protection Warning Levels

Stocks marked with T indicate that their prices have increased significantly or are highly speculative. The stock exchange imposes trading restrictions to control volatility, divided into three levels:

• T1 (Trading Alert Level 1) - First level: Must buy with cash only (Cash Balance) and hold for 3 weeks.

• T2 (Trading Alert Level 2) - Second level: If after 1 month from T1 the stock still meets criteria, it escalates to T2. Must buy with cash only, cannot use as collateral, and must hold for 3 weeks.

• T3 (Trading Alert Level 3) - Third level: If after 1 month from T2 the stock still meets criteria, it escalates to T3. Must buy with cash only, cannot use as collateral, and upon sale, funds will be available the next day, not immediately (No Offset). This measure prevents repeated trading within the same day.

Note: Cash Balance accounts are recommended for beginners because you can only buy up to the amount of cash you have.

Risk Warning Symbols: Be Cautious

These symbols indicate that the stock or company may have issues and require careful consideration:

• H (Trading Halt) - Temporary trading suspension for 1 session: Usually occurs due to unreported news or pending official disclosures.

• SP (Trading Suspension) - Suspension exceeding 1 session: May be due to undisclosed news or failure to submit financial statements.

• NP (Notice Pending) - Company has pending information to report; once reported, it will change to NR.

• NR (Notice Received) - The company has provided clarification to the securities exchange.

• NC (Non-Compliance) - The company has been unprofitable for a long time, failed to submit financial statements, or has serious issues that could lead to delisting. The company has 1 year to rectify.

• ST (Stabilization) - Price stabilization period: Newly IPOed companies may implement measures to prevent the stock price from falling below the IPO price during the first 30 days.

• C (Caution) - Risk warning: The company faces financial problems, such as shareholders’ equity below 50%, paid-up capital, bankruptcy lawsuits, auditor disclaimers, or has become a Cash Company (selling almost all assets).

How to Check CA and Other Symbols

For investors, checking these symbols is straightforward. Simply go to the stock trading platform, click on the symbol displayed, and you will see details about what the event is, when it will happen, helping you make more informed investment decisions.

Remember

Understanding CA symbols and suffix indicators is fundamental knowledge for stock investors. Whether you are a beginner or experienced, these symbols help you understand stock movements and prepare for trading in advance. The most important thing is to read and analyze all information thoroughly before investing to reduce risks and increase your chances of success in the stock market.