Selling

for a decline or selling short is the opposite of buying, except that the seller, not having the stock, is obliged to ] borrow it for delivery and take the risk of buying it back at a future day to return to the lender. The chief risk in selling short is in the po ibility of a corner in the stock as a result of which the price may be forced up to an extraordinary figure. Ordinarily the speculator has no interest to pay on stock sold. short, but if it is scarce a consideration may have to be paid to the lender for its use from day to day. Margins and commi ions are the same as in the case of stock bought. A speculator who has sold for a fall is said to be short and he is a “Dear.” In buying or selling on option the purchaser or the é seller, as may be stipulated, has the option to call: for or to tender the stock at the price named at any time within the period limited by the contract. The New: York Stock Exchange does not recognize such contracts for le than 4 days nor for more than 60 days. A speculator: anticipating a rise in a stock may purchase 100 shares buyer 30, which gives him the option or right to call for the delivery of the stock at any time within 30 days at the price named, this price being usually somewhat above the price ruling at the time. Ifa decline in a stock is expected a sale is made seller 30, or at the seller’s option to deliver at any time within 30 days at the price named, the price being usually below the price ruling at the time. In purchases at buyer’s option the buyer is charged with interest on the price of the stock up to the time: he calls for it. In sales at seller’s option the seller is credited with interest on the price of the stock until he delivers it. In-: 7 terest is at 6 per cent and at the end of the optional period the seller is obliged to deliver and the buyer to receive the stock if the contract has not previously been closed. Margins and commi ions are the same on stocks bought or sold. 494