TERMS USED IN TRADING 313 



"A 'Margin' is a certain amount of money deposited with a broker 

 or commission house to protect trades made or to be made. Thus a 

 man trading on a margin need advance only a small part of the value 

 of the property he is buying or selling. For instance you may in 

 normal times buy or sell 5,000 bushels of wheat on a 5-cent margin for 

 $250 when perhaps the actual value of 5,000 bushels of wheat at that 

 time is $5,000. However, if the market goes against you to the extent 

 of your margin you must deposit additional money with the broker or 

 commission concern to protect them, or close out your trade. 



"A 'Stop Order' is an order to close a trade at a specified price in 

 order to limit losses. Such an order is automatically acted upon when 

 the price stated thereon is reached, but in wild markets, such as have 

 at times been witnessed, it is impossible to close the trade at a certain 

 price and perhaps the 'Stop Order* will be executed at a price 2 or 3 

 cents away from the desired figure. 



"Among members of the Board of Trade and in market reports you 

 hear much of the 'cables'. This refers to the foreign markets, particu- 

 larly that at Liverpool. 



"Another expression much used on the Board of Trade is 'Visible 

 Supply' and by this is meant the stocks of grain in public elevators in 

 large cities and afloat on the canals, lakes and rivers. 



"There are many more expressions identified only with the grain 

 trade, but we have dealt with the more important ones here, particu- 

 larly as used in connection with the speculative branch of the business. 



"We often hear of the market being 'cornered'. By this is meant 

 that a party or combination of parties have purchased more grain than 

 the sellers or 'Shorts' will be able to deliver. They have created an 

 artificial scarcity. The 'Shorts' finding themselves unable to get suf- 

 ficient grain from the public elevators or from the country are forced 

 to buy in the pit and pay what the 'Longs' demand. In the days of 

 'Old Dutch', Pardridge and Leiter there was much of this done and it 

 was then that the Board of Trade earned the notorious reputation that 

 the general public is disposed to give it. However, in recent years 

 there has been a determined effort to 'clean house' and under the 

 present rules of the association it is impossible to 'corner' a market. 



