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London Metal Exchange

London Metal Exchange (LME) brokers facilitate trading on the commodities exchange based in London, UK. The exchange offers derivatives like futures and options contracts on a range of metals, including copper futures, aluminium alloy and silver. This guide explains how to compare the top London Metal Exchange brokers in 2024, considering platforms, fees, leverage and more. We also run through what the LME is, its history, the metals traded and much more.

London Metal Exchange Brokers

These are the 2 best brokers for trading on the London Metal Exchange:

  1. Fusion Markets
  2. Interactive Brokers

#1 - Fusion Markets

Why We Chose Fusion Markets

Fusion Markets is an online broker established in 2017 and regulated by the ASIC, VFSC and FSA. It is best known for its low-cost forex and CFD trading, although its multiple account types and copy trading solutions cater to a range of traders. New clients can sign up and start trading in 3 easy steps.

"Fusion Markets is a standout option for forex traders looking for excellent pricing with spreads near zero, industry-low commissions and recently TradingView integration. It’s a particularly good broker for Australian traders where the company is headquartered and regulated by the ASIC."

- DayTrading Review Team
  • Instruments: CFDs, Forex, Stocks, Indices, Commodities, Crypto
  • Regulator: ASIC, VFSC, FSA
  • Platforms: MT4, MT5, cTrader, TradingView, DupliTrade
  • Minimum Deposit: $0
  • Minimum Trade: 0.01 Lots
  • Leverage: 1:500

Stock Exchanges

Fusion Markets offers trading on 14 stock exchanges:

  • Australian Securities Exchange (ASX)
  • CAC 40 Index France
  • DAX GER 40 Index
  • Dow Jones
  • Euronext
  • FTSE UK Index
  • Hang Seng
  • IBEX 35
  • Japan Exchange Group
  • London Metal Exchange
  • Nasdaq
  • New York Stock Exchange
  • S&P 500
  • Toronto Stock Exchange

Pros

  • The range of charting platforms and social trading features is excellent, with MT4, MT5, cTrader and more recently TradingView, catering to a wide range of trader preferences.
  • Fusion Markets offers best-in-class support with very fast, friendly and helpful responses during tests and no frustrating automated chatbot to navigate.
  • Fusion Markets continues to impress with its pricing that provides tight spreads with below-average commissions that will appeal to active day traders.

Cons

  • Fusion Market trails alternatives, notably eToro and IG, in the education department with limited guides and live video sessions to upskill new traders.
  • The demo account expires after 30 days, limiting its potential as a useful trading tool alongside a real-money account.
  • While the selection of currency pairs trumps most rivals, the broker's alternative investment offering is average with no stock CFDs beyond the US.
Visit Fusion Markets

#2 - Interactive Brokers

Why We Chose Interactive Brokers

Interactive Brokers (IBKR) is a premier brokerage for experienced traders, providing access to 150 markets in 33 countries, along with a suite of comprehensive investment services. With over 40 years of experience, this Nasdaq-listed firm adheres to stringent regulations by the SEC, FCA, CIRO, and SFC, amongst others, and is one of the most trusted brokers for trading around the globe.

"Interactive Brokers is one of the best brokers for advanced day traders, providing powerful charting platforms, real-time data, and customizable layouts, notably through the new IBKR Desktop application. Its superb pricing and advanced order options also make it highly attractive for day traders, while its diverse range of equities is still among the best in the industry."

- DayTrading Review Team
  • Instruments: Stocks, Options, Futures, Forex, Funds, Bonds, ETFs, Mutual Funds, CFDs, Cryptocurrencies
  • Regulator: FCA, SEC, FINRA, CFTC, CBI, CIRO, SFC, MAS, MNB
  • Platforms: Trader Workstation (TWS), IBKR Desktop, GlobalTrader, Mobile, Client Portal, AlgoTrader, OmniTrader, eSignal, TradingCentral
  • Minimum Deposit: $0
  • Minimum Trade: $100
  • Leverage: 1:50

Stock Exchanges

Interactive Brokers offers trading on 15 stock exchanges:

  • Borsa Italiana
  • CAC 40 Index France
  • Chicago Mercantile Exchange
  • Euronext
  • IBEX 35
  • Japan Exchange Group
  • Korean Stock Exchange
  • London Metal Exchange
  • London Stock Exchange
  • Nasdaq
  • Nasdaq Nordic & Baltics
  • New York Stock Exchange
  • Russell 2000
  • Shenzhen Stock Exchange
  • Toronto Stock Exchange

Pros

  • IBKR is one of the most respected and trusted brokerages and is regulated by top-tier authorities, so you can have confidence in the integrity and security of your trading account.
  • With low commissions, tight spreads and a transparent fee structure, IBKR delivers a cost-effective environment for short-term traders.
  • There's a vast library of free or paid third-party research subscriptions catering to all types of traders, plus you can enjoy commission reimbursements from IBKR if you subscribe to Toggle AI.

Cons

  • You can only have one active session per account, so you can’t have your desktop program and mobile app running simultaneously, making for a sometimes frustrating trading experience.
  • TWS’s learning curve is steep, and beginners may find it challenging to navigate the platform and understand all the features. Plus500's web platform is much better suited to new traders.
  • Support can be slow and frustrating based on tests, so you might find it challenging to reach customer service representatives promptly or encounter delays in resolving issues.
Visit Interactive Brokers

How To Compare London Metal Exchange Brokers

These helpful tips and tricks will let you compare brokers with access to the London Metal Exchange:

Education

The internet is blessed with many resources to teach you all you need to know about the London Metal Exchange. There are videos on YouTube, as well as PDFs and online books that will expand your knowledge.

The best London Metal Exchange brokers will consolidate learning materials for a one-stop solution to develop your understanding of the exchange and execute more accurate trades.

Also make use of demo profiles if your LME broker offers this, as it can be an ideal way to put your learning into practice risk-free. 

News

History can play an important role in predicting prices at London Metal Exchange brokers. Look at anything from historical copper prices to recent copper and steel price graphs from 2024 to the latest demand and supply predictions, to learn about past trends which may repeat themselves.

The top London Metal Exchange brokers offer integrated news streams and push notifications to stay up to date with important announcements.

Investors that can react quickly and efficiently to the latest market news often remain a step ahead of the game.

Platforms

Stable, reliable and accessible platforms should be one of the main considerations when comparing London Metal Exchange brokers. Tools and services should be compared based on your previous trading experience. Make sure you have access to a range of analysis tools, historical pricing and customizable graphs and charts.

Also look out for mobile-compatible apps so you can trade on the go. Those with SMS alerts or push notifications are often good picks.

How To Trade The LME

If you want to trade contracts directly on the London Metal Exchange, you must do so through an LME member. Here, we will describe how you can participate indirectly through London Metal Exchange brokers. Exchange-Traded Commodities (ETCs), similar to ETFs, are traded on the London Metal Exchange. To trade these, follow this guide:

  1. Choose A Broker: There are many London Metal Exchange brokers to choose from when looking to trade ETCs on the exchange. When trying to find the best London Metal Exchange brokers, we recommend comparing fees and premiums as well as customer support levels before deciding which to use. Also, if you want to conduct mobile investing, check whether they support an app.
  2. Deposit Funds: Once you have selected LME brokers, deposit funds to your account.
  3. Purchase ETC: You are now ready to purchase an exchange-traded commodity (ETC) on the London Metal Exchange (LME).

What Is The London Metal Exchange?

The London Metal Exchange is a futures and forwards exchange featuring the world’s largest market for futures contracts on metals. The exchange offers contracts on base metals, as well as ferrous metals, precious metals and electric vehicle metals.

It is the world centre for industrial metals trading, with the majority of all non-ferrous metal futures business transacted on the exchange. As a result, people from India to the US regularly visit LME brokers.

The London Metal Exchange is owned by Hong Kong Exchanges and Clearing Ltd. (recognizable worldwide with their simple HKEX logo), the group that also owns the Hong Kong Stock Exchange and Hong Kong Futures Exchange. HKEX are the sole shareholders of the London Metal Exchange, and therefore there is no listed share price for the company. Instead, members can purchase B-shares in LME Holdings Limited.

According to recent annual reports, the London Metal Exchange had a trading volume of 170 million lots via online brokers and direct investing, worth over $12 trillion in notional value, though no market cap data was released. Even though revenue fell in recent years due to the coronavirus pandemic, the exchange remains one of the largest of its kind.

History Of The London Metal Exchange

The origins of the London Metal Exchange can be traced as far back as 1571 with the opening of the Royal Exchange in London. Before the creation of the exchange, business between traders was carried out in London coffee houses, where the trading ring tradition began.

The London Metal Exchange was founded in 1877. At first, the only metal traded on the exchange was copper (rate and scrap copper both had prices), although zinc and lead prices were soon added in 1920.

Upon the outbreak of World War 2, the London Metal Exchange was closed. It would not re-open until 1953. Following this, many new metals were added to the inventory of the exchange. In 2011, the exchange stopped offering plastics.

The London Metal Exchange was under the ownership of its members until 2021 when Hong Kong Exchanges and Clearing Limited purchased the LME for £1.4 billion.

Metals Traded On LME

There is a whole host of metals traded on the London Metal Exchange. Inventory data, such as the daily live prices of copper or gold price per kg, is available to download on its website or via supporting LME brokers but here is a breakdown of the various commodities on offer.

Non-Ferrous Metals

The London Metal Exchange is the largest non-ferrous metal exchange in the world featuring many different products:

Ferrous Metals

On top of their non-ferrous range, London Metal Exchange brokers may offer ferrous metals. The focus is on steel, with prices for steel scrap and steel rebar, as well as steel HRC from China, North America, Europe and India.

EV Metals

The London Metal Exchange features a range of minor metals, typically used in electric vehicles:

Precious Metals

London Metal Exchange brokers typically offer precious metals on:

Metals That Are Not Traded

While the London Metal Exchange and supporting brokers do offer contracts for a lot of different metals, some are not listed on the exchange. Investors will not find iron ore prices listed on the UK based exchange, nor will they find titanium, brass, antimony, bronze, vanadium, manganese, zirconium, bismuth, bauxite, tungsten (wolfram), indium or iridium price.

Contract Types

A key part of understanding and trading with London Metal Exchange brokers is to know the types of contracts available. Contract lengths can vary from one week to multiple months or even multiple year-long contracts. The main types of products include:

Futures

A futures contract with London Metal Exchange brokers works as any other future would. These are an obligation to buy or sell the specified asset (metal) on a set date and at an agreed fixed price. Any futures that are not closed out by an opposite purchase are physically settled.

Options

An option is similar to a future. In this case, the option provides the right, but not the obligation, to buy or sell the specified asset (metal) on a set date and at an agreed fixed price. Using options contracts with the London Metal Exchange brokers may warrant further hedging on trades and investments due to the increased flexibility.

TAPOs

TAPOs are Traded Average Price Options. They are another flexible way for the London Metal Exchange to hedge against fluctuating metal prices. TAPOs are financially settled Asian options. The payoff is dependent on the Monthly Average Settlement Price (MASP) for the contract month.

Monthly Average Futures

This instrument is designed for London Metal Exchange members who need to hedge against the monthly average price. It is the first of its type in the world. Participants enter into a fixed price and settle the difference against the floating price (the Monthly Average Settlement Price or MASP) at the end of the averaging period. A keen trader always notices the fluctuations during the month and uses this tool to hedge against them.

Trade At Settlement

At the London Metal Exchange, trade-at-settlement (TAS) contracts are only available on LME 3-month Nickel. Participants use TAS contracts to enter an order to buy or sell a contract at a price that is either equal to, or several ticks above or below, the yet to be established 3-month closing price.

Participants should have studied the nickel price history before entering this contract. Once the closing price is set, the TAS order delivers the 3-month contract.

HKEX London Minis

HKEX London Minis are designed specifically for Asian participants. They are traded and priced in CNH or US dollars and are available in six metals: aluminium, zinc, copper, nickel, tin and lead.

LMEminis

These are five-tonne cash-settled monthly futures contracts. They are settled against the London Metal Exchanges ‘parent’ contract, LME Official Settlement Price. Investors can be confident that the price at settlement is reflective of global supply and demand.

LME Index

The London Metal Exchange Index consists of six metals with the following weights: aluminium (42.8%), copper (31.2%), zinc (14.8%), lead (8.2%), nickel (2%) and tin (1%). The weightings are derived from trade liquidity and global production volume over five years. .

Trading Methods

The London Metal Exchange has three different methods of trading: open outcry, electronic trading and telephone trading. Open outcry is the traditional form of investing where traders meet face-to-face on the trading floor in pits or rings at set times of the day. The LME is the only remaining physical commodity exchange in Europe and it is currently bucking a global trend of switching completely to electronic investing via online brokers.

After closing for COVID and then being slated to close permanently, the London Metal Exchange announced the news that they were “to reopen trading floor” after uproar from the public and high-profile individuals like Nigel Farage.

Electronic trading has been used at the London Metal Exchange since 2001. The exchange uses its platform, LME Select, to facilitate this form of investing, allowing people to trade from home or foreign offices. This platform now handles the majority of LME business.

Ring Trading

Ring trading is a tradition at the London Metal Exchange that has stood for years. Ring trading is important to the process of price discovery, which is how official prices are set. There are two ring trade sessions in the morning and afternoon. Each of the nine metal contracts is traded in two blocks with a five-minute session for each.

Traders with Ring Dealing membership are entitled to trade in the ring. In total, nine companies have the exclusive right to trade in the ring. In addition to these nine, there are around 100 companies involved in the London Metal Exchange.

Delivery Points & Hedging

While most contracts on the London Metal Exchange are used to hedge against market fluctuation, the LME delivery option can be used if needed. The LME has a network of over 600 warehouses in 15 countries. Metal stocks are kept in these warehouses should delivery need to be completed. Only around 1% of trades use the delivery service.

London Metal Exchange Rules & Regulations

The London Metal Exchange has a set of rules and regulations that members must follow. These are set out in the LME Rulebook, which can be found on the exchange’s website. The LME Daily Position Reporting System (DPRS) enables members to submit information to the Compliance Support System (CSS).

As an exchange operating in the UK, the London Metal Exchange comes under the jurisdiction of the Financial Conduct Authority (FCA).

Trading Hours

Working hours at the London Metal Exchange vary for the different investing methods. Ring trading occurs in two sessions. The first is the morning session, beginning at 11:40 and ending at 13:15 GMT. The second is the afternoon session, beginning at 15:00 and ending at 17:00 GMT.

The opening time for the LME Select electronic system is 01:00, which stays live until 19:00 GMT. This method captures the Asian trading day. Telephone trading is available 24 hours. All methods are only available Monday through Friday.

Calendar

The London Metal Exchange calendar features holidays in 2024 and beyond. London Metal Exchange brokers should provide an updated working hours calendar reflective of key market closure dates.

London Metal Exchange Vs CME

One of the London Metal Exchanges main competitors is the Chicago Mercantile Exchange. Though it is difficult to compare the two, the CME offers a much broader range of assets, including agricultural and energy products, while London Metal Exchange brokers focus solely on metals.

One area that LME leads in is that of environmental, social and governance (ESG) concerns. The LME is committed to a sustainable future and has pledged to include green aluminium in the future.

Notable Employees

Mathew Chamberlain is the CEO of the London Metal Exchange. He took over from former chief Garry Jones in 2017. Some other employees of note include Chris Jones (the Chief Risk Officer for the London Metal Exchange’s clearinghouse, LME Clear), Katy Hyams (Head of Regulatory Policy) and Kirstina Combe (Head of Regulation and Compliance). Diarmuid O’Hegarty was a long-serving member on the board of directors and operated in many roles during his time.

Branches

The London Metal Exchange has two branches:

Contact Details

The London Metal Exchange can be contacted if there are any client issues, including when arbitration is required. Email addresses for various departments (with the email format @lme.com) can be found on the LME website. The phone numbers to call for each branch are:

If you are trading via London Metal Exchange brokers, contact their customer support team separately.

Final Word On London Metal Exchange Brokers

The London Metal Exchange (LME) is a commodities exchange steeped in a deep and rich history. From humble roots in coffee houses, the exchange has built many traditions including the world-famous ring. The LME is the largest and most important exchange when it comes to non-ferrous metals like copper, lead and zinc. If you want to get into the metal trading business via online London Metal Exchange brokers, or profit indirectly from it, follow our handy guide.

FAQs

Can I Purchase LME A Shares Through Online Brokers?

No, you cannot. HKEY Exchanges and Clearing Limited are the sole shareholders of the London Metal Exchange. However, it is possible to purchase B shares.

Can I Buy Iron Futures On The London Metal Exchange Via Online Brokers?

No, you cannot buy iron futures contracts on the London Metal Exchange. However, steel, the iron alloy, is often available.

Is There Still Open Outcry Trading At LME?

Yes, open outcry trading is still conducted at the London Metal Exchange. The trading floor was reponed after outrage from the community.

What Is The LME Official Settlement Price?

The LME Official Settlement Price is the last cash offer price at which all LME futures are settled. It is published between 12:30 and 13:25 GMT.

What Is LME’s LMEGA?

LMEGA is the London Metal Exchange Golf Association. Members can meet up and play golf with other individuals in the metal industry.