London Metal Exchange launches LME swaps

‘LME swaps introduce a new kind of contract to the market, which responds to the needs of the physical industry,’ says Chris Evans, Head of Business Development at the LME. ‘For the first time, LME swap-users will benefit from a regulated market with the same counter-party default risk protection offered by other LME contracts.’

LME swaps enable physical market participants to 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 - all in one simple trade.