Morals of the Church
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point — Wouters, Manual of Moral Theology

Point V. On Stock-Exchange Games

954.

I. Notion. Stock-exchange games are understood as contracts by which the contracting parties intend to make gain from the diversity of price which monetary values, merchandise, or securities have in the market at different times.

Stock-Exchange Dealings

955.

II. Division. The principal ones are: buying-selling for a term, and buying-selling for a premium.

  1. In the case of buying-selling for a term, one party buys something from the other at a determined price, to be delivered on an established day, for example after three months. If the price has increased on the established day, the buyer has made a gain and the seller a loss; the former indeed because he must sell the thing more dearly, the latter because he must buy it more dearly. If the price has decreased, the contrary has place.

More often, however, the contracting parties do not intend a true buying-selling, but only that profit and loss be divided between them. That is, if the price has increased on the day of delivery, as it were established, the seller pays the increase of price to the buyer; if it has decreased, the buyer pays the same sum to the seller.

  1. In the case of buying-selling for a premium, one party likewise buys something from the other party at a determined price, to be delivered on an established day; but under this condition, that either of the contracting parties can withdraw from the contract, provided he pays some premium to the other party.

Stock-Exchange Dealings

956.

III. Morality. Stock-exchange games, as is clear, are not illicit per se. Per accidens they are often to be dissuaded from or even prohibited, namely because of the danger of harming the family or creditors, or of spreading false reports so that prices may be increased or diminished, etc.

As regards the price of shares and bonds, cf. n. 904.

Stock-Exchange Dealings