What is Ex-rights (XRT)?
XRT is an extension that appears after a stock’s ticker symbol. The term ex-rights is abbreviated as XRT. Ex-rights indicate that the buyer of the stock no longer has the right to purchase additional shares at a lower price because those rights have expired. For clarity and to avoid disputes or confusion about where the rights currently remain, XRT is printed on the ticker tape or displayed on the electronic ticker.
The SPDR S&P Retail exchange-traded fund is also denoted by the symbol XRT (ETF). This is an index fund that tracks a broad-based, equal-weighted index of stocks in the retail industry in the United States.
Attaching rights to a stock via a rights offering allows buyers to maintain their position in the stock if the stock issues more shares soon after the buyer purchases. It works in the same way that a price guarantee does for the purchase of a retail product, in that the purchaser does not have to worry about the price of a product rising because the price is guaranteed for a set period of time.
When the rights expire, the stock price falls because there is no longer a guarantee that the purchaser can maintain an ownership percentage at the same price. As a result, the stock is less valuable to the buyer.