Note 116 — Chapter IX · THE LONDON STOCK EXCHANGE, AND COMPARISONS WITH ITS NEW YORK PROTOTYPE

Although an effort has been made in these pages to avoid complicated Stock Exchange technique, the contango, which is not fully understood in America, requires technical explanation. It may be defined as a double-bargain, in that it consists of a sale for cash of the stock previously bought which the broker does not wish to carry, and a repurchase for the new settlement two weeks ahead, of the same stock at the same price as the sale, plus interest agreed upon up to the date of that settlement.