HOTTER ON METALS: Short-dated carries need a break

Charles Li, ceo of Hong Kong Exchanges & Clearing (HKEX), has said he is open to a discussion on fees paid to trade on the London Metal Exchange.

Reducing the cost of trading short-dated carries is potentially the best course of action he and LME management could initially take.
Critical to not just the members but also to their industrial clients who roll positions daily, activity in the short-dated carries and particularly tom-next has fallen away dramatically over the past 18 months.
It all began when the exchange put up its fees at the start of 2015 – not an unexpected move, particularly given its new owner had paid £1.388 billion ($2.232 billion) for the LME in 2012 and has invested in its infrastructure and technology since.

The carries were discounted when the hike took effect, but the increase has nonetheless been painful for many traditional members and their clients to...


Andrea Hotter

July 08, 2016

17:18 GMT

New York