backwardation

[ bak-wer-dey-shuhn ]

noun

1. (on the London stock exchange) the fee paid by a seller of securities to the buyer for the privilege of deferring delivery of purchased securities.

backwardation

/ ˌbækwəˈdeɪʃən /

noun

1. the difference between the spot price for a commodity, including rent and interest, and the forward price
2. (formerly, on the Stock Exchange) postponement of delivery by a seller of securities until the next settlement period

Word History and Origins

Origin of backwardation¹

First recorded in 1840–50; backward + -ation