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Contango is a very common term in financial business that originally referred to:

  • (on the London stock exchange) a fee paid by a buyer of securities to the seller for the privilege of deferring payment. (Dictionary.com)

and is mow more commonly used to mean:

  • (Contango) is a situation where the futures price (or forward price) of a commodity is higher than the expected spot price.(Wikipedia)

According to Etymonline the term is a fanciful invention of a stockbroker,
Contango:

  • 1853, a stockbroker's invention, perhaps somehow derived from continue, or from Spanish contengo "I contain, refrain, restrain, check." As a verb, from 1900.

    • 1853 N. & Q. 17 Dec. 586/2 Contango, a technical term in use among the sharebrokers of Liverpool. (OED)

Questions:

1) Was the term really invented or was it taken from other contexts, from a local dialect or a foreign language for instance?

2) The opposite of contango is the more obvious literal term "backwardation". Wasn't the stockbroker imaginative enough to make up an eccentric term for it also?

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    Not an answer, but some further info: books.google.com/…
    – TimR
    Jan 20, 2016 at 15:57
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    OED says that contango is apparently an arbitrary or fortuitous formation derived from continue. It includes the citation from 1853 also. Some other etymology sources say similar things like it might be a corruption of "continue","continuation" or "contingent". I could find one source saying that the word is of Cockney origin and Cockney speakers are known for their peculiar slang language.
    – ermanen
    Jan 20, 2016 at 15:57
  • con- with, tango: a type of dance
    – QuentinUK
    Jan 20, 2016 at 17:12
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    John Quincy, M.D., Lexicon Physico-Medicum: Or, A New Medicinal Dictionary (1722) reports that the word contango (meaning "to touch together) is the source of the English medical term contiguity, referring to "the joining one Surface to another without any Interstice." Given the required study of Latin in schools, perhaps contango in businessspeak was in part a nod to the Latin word for "touching."
    – Sven Yargs
    Jan 22, 2016 at 1:38

3 Answers 3

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You already have the OED's earliest cite, which points out that it seems to have originated in Liverpudlian, not London, English. There's no present understanding about the term, though you could try looking for resources on the history of Scouse that might earn you a place in future etymology compilations.

The only thing I'll note that others haven't is that there is no Latin term contango except there is: contingo is formed from con- + tango, with a vowel shift occurring. The term could have originated in dog Latin (it's irregularly attested on Google Books in the 17th and 18th century) and simply proven too profitable a notion to not have a ready word at hand.

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Contango

  • The term originated in mid-19th century(1850-55) England and is believed to be a corruption of "continuation", "continue" or "contingent"
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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.

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