What is LME in shipping?
The London Metal Exchange (LME) is a commodities exchange that deals in metals futures and options. It is the largest exchange for options and futures contracts for base metals, which include aluminum, zinc, lead, copper, and nickel.
What is LME carry trade?
LME allows users to create spreads, referred to by LME as “carries,” which consist of any two contracts of the same product. The front leg must have an earlier prompt date than the back leg of the Custom Carry contract.
What are LME contracts?
LME futures provide members of the metal and investment communities with the unparalleled opportunity to transfer and take on price risk. A futures contract is the obligation to buy or sell a standard quantity of a specified asset (metal) on a set date, at a fixed price agreed today.
What is cash LME?
Cash prices represent the current price in the market for spot contracts. LME cash contracts are for settlement or delivery two Business Days forward from the trading day.
How does the LME ring work?
Ring trading is the method by which certain types of investment business is conducted at the London Metal Exchange (LME), where trading activity occurs in five-minute intervals known as “rings” within a six-meter diameter circle (a particular type of trading pit) with two large display boards that show current prices.
Who regulates the LME?
the Financial Conduct Authority
From 3 December 2019, the LME is also authorised and regulated by the Financial Conduct Authority in respect of its benchmark administration activities under the European Benchmarks Regulation.
What is LME Select?
FAQs. LMEselect is the electronic member to member trading system. Its tradable hours are 01.00-19.00 for Base metals, 01.00-20.00 for Precious metals, Monday-Friday (London Time) with pre-trade and post-trade periods 00.45-01.00 and 19.00-19.30 (Base), 20:00-20:30 (Precious) respectively.
What time does the LME close?
Trading day and price points
| Trading day and price points | London | Singapore |
|---|---|---|
| LME Official and Official Settlement Price published | 12.20 – 13.25 | 20.20 – 21.25 |
| LME Unofficial Price established and published | 15.00 – 15.35 | 22.00 – 22.35 |
| LME Closing Price established | 15.50 – 17.00 | 22.50 – 00.00 |
| Ring close | 17.00 | 00.00 |
What are cash settled futures?
A cash settlement is a settlement method used in certain futures and options contracts where, upon expiration or exercise, the seller of the financial instrument does not deliver the actual (physical) underlying asset but instead transfers the associated cash position.
How do you trade copper on LME?
Copper can be traded through a variety of trading instruments where traders may or may not own the actual product. The main ways to trade copper through a broker or an exchange are through bullion, contracts for difference (CFDs), futures, options, ETFs, and shares.
What is cash settlement price?
Cash settlement involves the purchaser or the contract holder to pay the net cash amount on the settlement date and execute the commodity settlement. The net cash amount is the difference between the spot price (SP) and the futures price (FP) of the underlying(s).
What is a cash settlement Future?
Key Takeaways. A cash settlement is a settlement method used in certain futures and options contracts where, upon expiration or exercise, the seller of the financial instrument does not deliver the actual (physical) underlying asset but instead transfers the associated cash position.