EXPERT VIEW: LME’s shift to electronic trading will edge out brokers – Rusal’s Evans

The London Metal Exchange’s recent introduction of an electronic trader programme for all clients of LME members could endanger the competitiveness of the bourse as a futures trading platform, says UC Rusal’s Chris Evans.

The LME is cutting fees for clients trading third-Wednesday outrights – what’s not to like about that? The exchange has become very expensive to use, so any reversal of fee hikes – annual revenues in 2015 were almost three times higher than in 2012 – is to be welcomed.

Look a little closer, though, and there is a catch, as Andrea Hotter so ably explained in her Hotter on Metals article. While it would be churlish not to welcome any rebate, industrial users should have concerns about the potential effects on the structure of the market that the move to incentivise direct third- Wednesday trading on LMEselect will have. The...

Published

Chris Evans

May 25, 2016

14:05 GMT

Zug