238 
COTTON 
the option of the seller at any time during the month 
for which it is sold, and they are called futures, 
because, as a rule, the contracts traded in are those 
which call for a delivery of the cotton at some fu- 
ture period." 
COTTON CONTRACTS 
The contract of the Cotton Exchange is in essen- 
tials a legal sale and purchase of cotton like other 
contracts, written or verbal, which call for a change 
in the ownership of any commodity. The cotton 
contract stipulates in writing that 50,000 pounds 
in about one hundred square bales are sold or 
bought, as the case may be, at a stated price, pay- 
ment to be made at or before some specified future 
period, usually at the end of the calendar month. 
One of the stipulations of this kind of contract is 
that the cotton must be delivered within the month 
and the buyer must receive and pay for it. There 
is no option about the contract except as to the 
time the seller may fulfill it. The New York con- 
tract calls for the delivery at the seller's option upon 
three days' notice to the buyer, the delivery to be 
made from one warehouse. The New Orleans 
contract gives the buyer five days' notice of delivery 
and allows the seller to deliver from cotton presses 
and railroad depots, and from two places. These 
contracts are made on the basis of Middling Up- 
lands ; when the cotton is of better grade, a higher 
price is paid by the purchaser — and a lower price, 
of course, if the staple be below the market grade. 
Thus, on the face of the contract, any sort of cotton 
between Fair and Good Ordinary may be delivered. 
Another feature of the contract is the right of either 
party to call for a margin as the variation of the 
