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The '''London Metal Exchange''' ('''LME''') is a futures and forwards exchange with the world's largest market in standarised [[forward contract]]s, [[futures contract]]s and options on [[base metals]]. The exchange also offers contracts on [[ferrous metals]] and [[precious metals]].<ref>{{cite web |title=Forward & Futures Contract Specifications |url=https://www.lme.com/en-gb/metals/non-ferrous/aluminium/contract-specifications/futures/ |publisher = London Metal Exchange |access-date=7 August 2015}}</ref> The company also allows for cash trading. It offers [[Hedge (finance)|hedging]], worldwide reference pricing, and the option of physical delivery to settle contracts.
The '''London Metal Exchange''' ('''LME''') is a futures and forwards exchange in [[London]], [[United Kingdom]] with the world's largest market<ref name=ReutersClear>{{cite web |url=https://www.reuters.com/markets/europe/clear-street-seeks-join-london-metal-exchanges-open-outcry-trading-floor-source-2024-09-25/|title=Clear Street seeks to join London Metal Exchange's open-outcry trading floor, source says|publisher=[[Reuters]] }}</ref> in standardised [[forward contract]]s, [[futures contract]]s and options on [[base metals]]. The exchange also offers contracts on [[ferrous metals]] and [[precious metals]].<ref>{{cite web |title=Forward & Futures Contract Specifications |url=https://www.lme.com/en-gb/metals/non-ferrous/aluminium/contract-specifications/futures/ |publisher=London Metal Exchange |access-date=7 August 2015 |archive-date=4 March 2016 |archive-url=https://web.archive.org/web/20160304040533/https://www.lme.com/en-gb/metals/non-ferrous/aluminium/contract-specifications/futures/ |url-status=dead }}</ref> The company also allows for cash trading. It offers [[Hedge (finance)|hedging]], worldwide reference pricing, and the option of physical delivery to settle contracts.


== Overview ==
== Overview ==
===Ring trading===
===Ring trading===
Trading Times are 11:40 to 17:00 [[GMT]].
Trading times are 11:40 to 17:00 [[GMT]].


The LME is the last exchange in Europe where open-outcry trading takes place.<ref name=Today>BBC Radio 4 ''[[Today (BBC Radio 4)|Today]]'', broadcast 25 October 2011.</ref> The ring was temporarily closed in March 2020 due to the [[COVID-19 pandemic]].<ref>{{cite news |last1=Agini |first1=Samuel |title=LME to shut down Ring trading after member tests positive for Covid-19 |url=https://www.fnlondon.com/articles/lme-to-shut-down-ring-trading-after-member-tests-positive-for-covid-19-20200317 |access-date=5 March 2021 |work=[[Financial News]] |date=17 March 2020}}</ref> In January 2021, LME proposed closing the ring, Europe’s last open-outcry trading floor, and moving permanently to an electronic system.<ref>{{cite news |last1=Burton |last2=Jack |first2=Farchy |first1=Mark |title=London's Raucous Trading Ring Calls Time on 144-Year History |url=https://www.bloomberg.com/news/articles/2021-01-19/london-metal-exchange-to-propose-closing-trading-ring-for-good |access-date=5 March 2021 |work=[[Bloomberg News]] |date=19 January 2021 |language=en}}</ref><ref>{{cite news |last1=Desai |first1=Pratima |title=End of an era? London Metal Exchange proposes closure of open-outcry trade |url=https://www.reuters.com/article/uk-lme-trading/end-of-an-era-london-metal-exchange-proposes-closure-of-open-outcry-trade-idUSKBN29O1MP |access-date=5 March 2021 |work=[[Reuters]] |date=19 January 2021 |language=en}}</ref>
The LME is the last exchange in Europe where open-outcry trading takes place.<ref name=Today>BBC Radio 4 ''[[Today (BBC Radio 4)|Today]]'', broadcast 25 October 2011.</ref> The ring was temporarily closed in March 2020 due to the [[COVID-19 pandemic]].<ref>{{cite news |last1=Agini |first1=Samuel |title=LME to shut down Ring trading after member tests positive for Covid-19 |url=https://www.fnlondon.com/articles/lme-to-shut-down-ring-trading-after-member-tests-positive-for-covid-19-20200317 |access-date=5 March 2021 |work=[[Financial News]] |date=17 March 2020}}</ref> In January 2021, LME proposed closing the ring, Europe's last open-outcry trading floor, and moving permanently to an electronic system.<ref>{{cite news |last1=Burton |last2=Jack |first2=Farchy |first1=Mark |title=London's Raucous Trading Ring Calls Time on 144-Year History |url=https://www.bloomberg.com/news/articles/2021-01-19/london-metal-exchange-to-propose-closing-trading-ring-for-good |access-date=5 March 2021 |work=[[Bloomberg News]] |date=19 January 2021 |language=en}}</ref><ref>{{cite news |last1=Desai |first1=Pratima |title=End of an era? London Metal Exchange proposes closure of open-outcry trade |url=https://www.reuters.com/article/uk-lme-trading/end-of-an-era-london-metal-exchange-proposes-closure-of-open-outcry-trade-idUSKBN29O1MP |access-date=5 March 2021 |work=[[Reuters]] |date=19 January 2021 |language=en}}</ref> However, the ring reopened in September of the same year after resistance from members.<ref>{{Cite news |last=Partridge |first=Joanna |date=2021-06-08 |title=‘Open outcry’ trading to restart at London Metal Exchange |url=https://www.theguardian.com/business/2021/jun/08/open-outcry-trading-to-restart-at-london-metal-exchange |access-date=2024-06-05 |work=The Guardian |language=en-GB |issn=0261-3077}}</ref>


In addition to the 9 companies that have exclusive rights to trade in the Ring, around 100 companies are involved in the LME in total.
In addition to the 9 companies that have exclusive rights to trade in the ring, around 100 companies are involved in the LME in total.


===Precious metals===
===Precious metals===
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===Electronic trading===
===Electronic trading===
The LME launched an electronic platform called LME Select launched in February 2001.<ref name="select">{{cite web |title=LME Select |url=https://www.lme.com/Trading/Systems/LMEselect |url-status=live |access-date= |publisher=London Metal Exchange}}</ref> This was developed by a [[Sweden|Swedish]] software house Cinnober. The platform is a FIX-based trading platform, and now handles a majority of the total LME business.
The LME launched an electronic platform called LME Select launched in February 2001.<ref name="select">{{cite web |title=LME Select |url=https://www.lme.com/Trading/Systems/LMEselect |access-date= |publisher=London Metal Exchange}}</ref> This was developed by a [[Sweden|Swedish]] software house Cinnober. The platform is a FIX-based trading platform, and now handles a majority of the total LME business.


===LME Clear===
===LME Clear===
LME Clear is the clearing house for the London Metal Exchange. Launched in 2014 it was designed and built in consultation with the market to provide cost-efficient, EMIR compliant clearing and settlement services, using cutting edge technology. LME Clear has announced the appointment of David Warren as Chairman effective July 20, 2023. David will succeed Marco Strimer, who will step down as Chairman at the end of his term of office.
LME Clear is the clearing house for the London Metal Exchange. Launched in 2014 it was designed and built in consultation with the market to provide cost-efficient, EMIR compliant clearing and settlement services, using cutting-edge technology. LME Clear has announced the appointment of David Warren as Chairman effective July 20, 2023. David will succeed Marco Strimer, who will step down as chairman at the end of his term of office.<ref>{{cite web |title=Crisis-hit LME's clearing house names former LSE CFO as chair|url=https://www.reuters.com/world/uk/crisis-hit-lmes-clearing-house-names-former-lse-cfo-chair-2023-07-05/ |access-date= |publisher=Reuters}}</ref><ref>{{cite web |title=New chairman of LME Clear board|url=https://metals-news.com/breaking-news/new-chairman-of-lme-clear-board// |access-date= |publisher=metals-news.com}}</ref>
<ref>{{cite web |title=Crisis-hit LME's clearing house names former LSE CFO as chair|url=https://www.reuters.com/world/uk/crisis-hit-lmes-clearing-house-names-former-lse-cfo-chair-2023-07-05/ |url-status=live |access-date= |publisher=Reuters}}</ref>
<ref>{{cite web |title=New chairman of LME Clear board|url=https://metals-news.com/breaking-news/new-chairman-of-lme-clear-board// |url-status=live |access-date= |publisher=metals-news.com}}</ref>


==Lawsuits==
==History==
LME can trace its history to metals trading in [[Royal Exchange, London]].<ref name=investopedia>{{cite web |url=https://www.investopedia.com/terms/l/londonmetalexchange.asp|title=What Is the London Metal Exchange (LME)? Definition and History|publisher=[[Investopedia]] }}</ref>
⚫
In March of 2022, LME was sued by [[Elliott Management Corporation|Elliott Management]], an American hedge fund. The hedge fund sued for $456 million, claiming that LME acted "unreasonably and irrationally" when it canceled nickel trades made on March 8, 2022.<ref>{{Cite web |date=2022-06-06 |title=London Metal Exchange sued for $456m over cancelled trades |url=https://www.theguardian.com/business/2022/jun/06/london-metal-exchange-sued-cancelled-trades-elliott-management |access-date=2022-06-21 |website=the Guardian |language=en}}</ref> Jane Street Global Trading also sued LME for $15.3 million over its cancelled nickel trades in March.<ref>{{Cite web |last=Smith |first=Elliot |date=2022-06-07 |title=London Metal Exchange hit with two U.S. lawsuits over nickel trading chaos |url=https://www.cnbc.com/2022/06/07/london-metal-exchange-hit-with-two-us-lawsuits-over-nickel-trading-chaos.html |access-date=2022-06-21 |website=CNBC |language=en}}</ref> Both lawsuits were filed in the English High Court.<ref>{{Cite news |date=2022-06-06 |title=London Metal Exchange sued for $456m over cancelled nickel trades |language=en-GB |work=BBC News |url=https://www.bbc.com/news/business-61701238 |access-date=2022-06-21}}</ref>

It was purchased by [[Hong Kong Exchanges and Clearing]] in 2012.<ref>{{cite news |author=<!--not stated--> |date=15 June 2012 |title=London Metal Exchange in £1.4bn sale to Hong Kong |url=https://www.bbc.com/news/business-18455901 |work=[[BBC]] |access-date=7 October 2024}}</ref>

⚫
In March 2022, LME was sued by [[Elliott Management Corporation|Elliott Management]], an American hedge fund. The hedge fund sued for $456 million, claiming that LME acted "unreasonably and irrationally" when it canceled nickel trades made on March 8, 2022.<ref>{{Cite web |date=2022-06-06 |title=London Metal Exchange sued for $456m over cancelled trades |url=https://www.theguardian.com/business/2022/jun/06/london-metal-exchange-sued-cancelled-trades-elliott-management |access-date=2022-06-21 |website=the Guardian |language=en}}</ref> Jane Street Global Trading also sued LME for $15.3 million over its cancelled nickel trades in March.<ref>{{Cite web |last=Smith |first=Elliot |date=2022-06-07 |title=London Metal Exchange hit with two U.S. lawsuits over nickel trading chaos |url=https://www.cnbc.com/2022/06/07/london-metal-exchange-hit-with-two-us-lawsuits-over-nickel-trading-chaos.html |access-date=2022-06-21 |website=CNBC |language=en}}</ref> Both lawsuits were filed in the [[High Court of Justice]].<ref>{{Cite news |date=2022-06-06 |title=London Metal Exchange sued for $456m over cancelled nickel trades |language=en-GB |work=BBC News |url=https://www.bbc.com/news/business-61701238 |access-date=2022-06-21}}</ref> In November 2023, the court ruled in LME's favor, with Elliott and Jane Street appealing the decision to the [[Court of Appeal (England and Wales)|Court of Appeals]].<ref>{{cite news |last1=Onstad |first1=Eric |title=Hedge fund Elliott challenges court verdict it lost against LME on nickel |url=https://www.reuters.com/markets/commodities/hedge-fund-elliott-challenges-court-verdict-it-lost-against-lme-nickel-2024-07-09/ |access-date=16 August 2024 |work=Reuters |date=10 July 2024}}</ref>


==See also==
==See also==
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{{Economy of the United Kingdom}}
{{Economy of the United Kingdom}}
{{Authority control}}

{{Coord|51|31|16|N|0|5|15|W|type:landmark_region:GB|display=title}}
{{Coord|51|31|16|N|0|5|15|W|type:landmark_region:GB|display=title}}


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[[Category:1877 establishments in the United Kingdom]]
[[Category:1877 establishments in the United Kingdom]]
[[Category:Organizations established in 1877]]
[[Category:Organizations established in 1877]]
[[Category:Metal industry]]
[[Category:Metal industry in the United Kingdom]]
[[Category:2012 mergers and acquisitions]]
[[Category:2012 mergers and acquisitions]]

Latest revision as of 14:42, 29 November 2024

London Metal Exchange
Formation1877; 147 years ago (1877)
PurposeTrading in metals and metals-related contracts
OwnerHong Kong Exchanges and Clearing

The London Metal Exchange (LME) is a futures and forwards exchange in London, United Kingdom with the world's largest market[1] in standardised forward contracts, futures contracts and options on base metals. The exchange also offers contracts on ferrous metals and precious metals.[2] The company also allows for cash trading. It offers hedging, worldwide reference pricing, and the option of physical delivery to settle contracts.

Overview

[edit]

Ring trading

[edit]

Trading times are 11:40 to 17:00 GMT.

The LME is the last exchange in Europe where open-outcry trading takes place.[3] The ring was temporarily closed in March 2020 due to the COVID-19 pandemic.[4] In January 2021, LME proposed closing the ring, Europe's last open-outcry trading floor, and moving permanently to an electronic system.[5][6] However, the ring reopened in September of the same year after resistance from members.[7]

In addition to the 9 companies that have exclusive rights to trade in the ring, around 100 companies are involved in the LME in total.

Precious metals

[edit]

The LME used,[8] however, to provide trade matching and clearing services to the London bullion market and distributes gold, silver, and gold IRS (interest rate swaps) forward rates on behalf of the LBMA.

Electronic trading

[edit]

The LME launched an electronic platform called LME Select launched in February 2001.[9] This was developed by a Swedish software house Cinnober. The platform is a FIX-based trading platform, and now handles a majority of the total LME business.

LME Clear

[edit]

LME Clear is the clearing house for the London Metal Exchange. Launched in 2014 it was designed and built in consultation with the market to provide cost-efficient, EMIR compliant clearing and settlement services, using cutting-edge technology. LME Clear has announced the appointment of David Warren as Chairman effective July 20, 2023. David will succeed Marco Strimer, who will step down as chairman at the end of his term of office.[10][11]

History

[edit]

LME can trace its history to metals trading in Royal Exchange, London.[12]

It was purchased by Hong Kong Exchanges and Clearing in 2012.[13]

In March 2022, LME was sued by Elliott Management, an American hedge fund. The hedge fund sued for $456 million, claiming that LME acted "unreasonably and irrationally" when it canceled nickel trades made on March 8, 2022.[14] Jane Street Global Trading also sued LME for $15.3 million over its cancelled nickel trades in March.[15] Both lawsuits were filed in the High Court of Justice.[16] In November 2023, the court ruled in LME's favor, with Elliott and Jane Street appealing the decision to the Court of Appeals.[17]

See also

[edit]

References

[edit]
  1. ^ "Clear Street seeks to join London Metal Exchange's open-outcry trading floor, source says". Reuters.
  2. ^ "Forward & Futures Contract Specifications". London Metal Exchange. Archived from the original on 4 March 2016. Retrieved 7 August 2015.
  3. ^ BBC Radio 4 Today, broadcast 25 October 2011.
  4. ^ Agini, Samuel (17 March 2020). "LME to shut down Ring trading after member tests positive for Covid-19". Financial News. Retrieved 5 March 2021.
  5. ^ Burton, Mark; Jack, Farchy (19 January 2021). "London's Raucous Trading Ring Calls Time on 144-Year History". Bloomberg News. Retrieved 5 March 2021.
  6. ^ Desai, Pratima (19 January 2021). "End of an era? London Metal Exchange proposes closure of open-outcry trade". Reuters. Retrieved 5 March 2021.
  7. ^ Partridge, Joanna (8 June 2021). "'Open outcry' trading to restart at London Metal Exchange". The Guardian. ISSN 0261-3077. Retrieved 5 June 2024.
  8. ^ "Archived copy" (PDF). Archived from the original (PDF) on 26 March 2015. Retrieved 31 March 2015.{{cite web}}: CS1 maint: archived copy as title (link)
  9. ^ "LME Select". London Metal Exchange.
  10. ^ "Crisis-hit LME's clearing house names former LSE CFO as chair". Reuters.
  11. ^ "New chairman of LME Clear board". metals-news.com.
  12. ^ "What Is the London Metal Exchange (LME)? Definition and History". Investopedia.
  13. ^ "London Metal Exchange in £1.4bn sale to Hong Kong". BBC. 15 June 2012. Retrieved 7 October 2024.
  14. ^ "London Metal Exchange sued for $456m over cancelled trades". the Guardian. 6 June 2022. Retrieved 21 June 2022.
  15. ^ Smith, Elliot (7 June 2022). "London Metal Exchange hit with two U.S. lawsuits over nickel trading chaos". CNBC. Retrieved 21 June 2022.
  16. ^ "London Metal Exchange sued for $456m over cancelled nickel trades". BBC News. 6 June 2022. Retrieved 21 June 2022.
  17. ^ Onstad, Eric (10 July 2024). "Hedge fund Elliott challenges court verdict it lost against LME on nickel". Reuters. Retrieved 16 August 2024.
[edit]

51°31′16″N 0°5′15″W / 51.52111°N 0.08750°W / 51.52111; -0.08750

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