Backwardation
Definition & Meaning
Pronunciation /bækwəˈdeɪʃn̩/ · Part of speech noun
Quick meaning: Backwardation is a noun meaning A situation in which short-term interest rates are higher than long-term interest rates.
Meaning
A situation in which short-term interest rates are higher than long-term interest rates.
More Meanings
- The situation in a stock market where the offer price for stock is lower than the bid price.
- In full normal backwardation: the situation in a futures market where the price for future delivery of a commodity (the forward price) is lower than the price for immediate delivery (the spot price) or nearer delivery, generally arising from a near-term shortage of the commodity.
- (obsolete) In the London Stock Exchange: a fee paid by a seller on settlement day either to the buyer or to a third party who lends stock, when the seller wishes to defer settlement until the next settlement day.
Word Forms
- backwardations
Antonyms for backwardation
Common opposites include contango, forwardation.
Related Words
Related dictionary entries include contango, forward, spread, netback, backsell, basis.
Related Dictionary Tools
Sources & Attribution
FreeDictionaryAPI.com / Wiktionary · Original source · CC BY-SA 4.0
Dictionary data is provided by FreeDictionaryAPI.com and sourced from Wiktionary under its stated license.