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Electronic trading on the LME

Over the past couple of years we have implemented a series of initiatives, as well as updates to our electronic trading platform (LMEselect) designed to:

• Enhance liquidity
• Simplify trading
• Tighten spreads
• Improve price transparency along the curve
• Enable greater market access

The initiatives that facilitate electronic trading on the LME include:

New release of LMEselect  - The upgrade of LMEselect 9.0 went live on 27 March 2017 and provides greater performance and capacity for electronic traders, and introduces dynamic price limits across all prompts and carries.

Membership enhancements  - Category 3 and 4 members now have direct access to LMEselect, alongside the introduction of additional flexibility in admission criteria for all membership categories. These changes are designed to facilitate greater market access and participation.

Electronic Trader Programme  - Our Electronic Trader Programme was introduced on 1 June 2016, reducing fees to $0.90 for all registered clients of members trading outright 3rd Wednesdays, and 3 months to and from 3rd Wednesdays.

Liquidity Provider Programme (LP)  - The LP incentive programme is aimed at existing traders who will receive volume-based rebates of clearing and trading fees.

New Market Participant Programme (NMP)  - This programme offers rebates for new participants who have not traded the market before,increase liquidity and trading on LMEselect.

Revision of Error Trade Policy - We amended the LME's error trade policy to give the LME the scope to adjust prices in error trades.

Optimised LMEselect tick sizes - In January 2015 we increased LMEselect tick sizes to match our open outcry platform, the Ring.

50-1 order-to-trade ratio restriction lifted  - We lifted the LMEselect 50-1 order-to-trade ratio restriction on outright 3rd Wednesdays. It covers aluminium, copper and zinc out to six months and promotes more liquidity for near-by monthly contracts.

Pre-trade risk management (PTRM)  - As part of the LMEselect 7.4 upgrade we introduced pre-trade risk management functionality, facilitating safe onboarding of new customers and a more secure market for all.

Trade compression - The clearing house for the LME, LME Clear, launched their post trade compression service giving market participants greater capital efficiency.

Data services  - In 2014 we gave latency-sensitive member clients direct access to data from LMEselect.

More information

Read about some of the updates in more detail here.

Contact us

Get in touch to find out more  on electronic trading opportunities at the LME.