contango

The term originated in mid-19th-century England, and is believed to be a corruption of continuation, continue or contingent. [1] In the past on the London Stock Exchange, contango was a fee paid by a buyer to a seller when the buyer wished to defer settlement of the trade they had agreed. The charge was based on the interest forgone by the seller not being paid.

contango (plural contangos or contangoes)

1. The situation in a futures market where prices for future delivery are higher than prices for immediate (or nearer) delivery.

   2005: most of these other commodities are generally in contango — Futures Industry Magazine

2. The amount by which prices for future delivery are higher than prices for near delivery.

   2003: Normally new buyers would go after the March silver contract, especially with such a small contango. — Bill Murphy, Kitco Bullion Dealers

3. (obsolete, London Stock Exchange) Fee paid by a buyer to the seller on settlement day when the buyer wishes to defer settlement until the next settlement day.

• backwardation

• contangoed
• contangoing
• contango day

contango (third-person singular simple present contangos, present participle contangoing, simple past and past participle contangoed)

1. (obsolete, London Stock Exchange, transitive, intransitive) To charge (a buyer) a fee to defer settlement until the next settlement day.

• contango on Wikipedia.Wikipedia