XRT

XRT: What It Means, How It Works, and the Function of Rights

Key takeaways
* XRT appended to a ticker (e.g., ABC.XRT) indicates the stock is trading ex-rights — the attached rights have expired.
* Rights give existing shareholders a short-term opportunity to buy newly issued shares at a set (usually discounted) price.
* When rights expire or detach, the stock often trades at a lower price because the added value of the rights is gone.
* XRT is also the ticker for the SPDR S&P Retail ETF.

What “ex-rights” (XRT) means
XRT is an extension printed after a stock’s ticker to show the security is trading ex-rights. Ex-rights means the period during which a buyer would have received attached rights to purchase additional shares at a preferential price has ended. Displaying XRT on the ticker tape prevents confusion about whether the rights are still attached to the traded shares.

How rights work
Rights are short-term financial instruments issued to existing shareholders when a company offers additional shares (a rights offering). They typically:
* Allow shareholders to buy new shares at a specified price below market for a limited time (often a few weeks).
* Be “attached” to existing shares during the rights period; in some cases they are detachable and can be traded separately.
* Expire after the rights period ends.

Why a company issues rights
A rights offering helps existing shareholders maintain their ownership percentage when the company issues new shares. It functions like a temporary price guarantee: shareholders have the option to buy additional shares at a predetermined price so their proportionate stake isn’t diluted (or is less diluted).

Price effect when rights expire
When rights are attached, the combined value of the share plus its attached right is generally higher than the share value alone. Once the rights expire or detach, that extra value disappears, so the stock price typically adjusts downward to reflect the loss of the rights’ benefit.

Ticker example
If Apex Borax Company’s ticker is ABC and the shares are trading ex-rights, trades may be displayed as:
* ABC.XRT

Note about the ETF ticker XRT
Separately, XRT is the ticker symbol for the SPDR S&P Retail ETF, an index fund that tracks a broad, equal-weighted index of U.S. retail stocks. Context determines whether XRT refers to the ex-rights notation or this ETF.

Summary
XRT on a ticker signals that rights previously attached to shares have expired, removing a short-term entitlement to buy additional shares at a set price. This change often leads to a downward price adjustment for the stock. The same symbol, XRT, is also used as the ticker for the SPDR S&P Retail ETF, so interpretation depends on context.