Options contract specifications

LME Lead

Options contracts give the buyer of the contract the right but not the obligation to buy (call option) or sell (put option) a futures contract at a set price. The buyer pays a premium for this right.

Contract code	PB
Underlying metal	Lead of 99.97% purity (minimum)
Lot size	25 tonnes
Contract months	Monthly out to 15 months
Underlying contract	LME Lead futures - third Wednesday prompt of the contract month
Price quotation	US dollars per tonne
Clearable currencies	US dollar, Japanese yen, sterling, euro
Option style	American
Trading deadlines	Tuesday before the first Wednesday of the prompt month: Last trading time - by 18.00 Last matching and registration - by 18.15
Expiry date/time	Any LME business day up to and including the first Wednesday of the expiring option month, from 08.00 up to: 11.15 for clearing members 11.10 for clients
Minimum price fluctuation (tick size)	$0.01 per tonne
Strike price intervals	$25 - for strikes from $25 to $9,975 $50 - for strikes from $10,000 to $19,950 $100 - for all strikes over $20,000
Exercise of option	Option exercise is a manual process. LME Clear auto-exercise in the money options that are equal to or greater than two strikes above and two strikes below the at-the-money strike, as determined by the end of day valuation price of the relevant third Wednesday prompt of the contract month, on the evening before the first Wednesday expiry day. There is manual exercise for the remaining close-to-the-money options. Options exercise will result in a third Wednesday futures contract.
Payment terms	One business day following the trade day
Settlement type	Physical
Trading venues	Ring, inter-office telephone and LMEselect (as a delta hedged option only)

Option exercise is a manual process.

LME Clear auto-exercise in the money options that are equal to or greater than two strikes above and two strikes below the at-the-money strike, as determined by the end of day valuation price of the relevant third Wednesday prompt of the contract month, on the evening before the first Wednesday expiry day. There is manual exercise for the remaining close-to-the-money options. Options exercise will result in a third Wednesday futures contract.

LME Lead contract specifications

This is a summary of the contract specifications. For full contract specification details, please refer to the LME Rulebook and for other information, please refer to our disclaimer page.

Note that all contracts are subject to the LME’s rules and regulations and LME Clear span margining.

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