The London Metal Exchange continues to upgrade LMEselect, the exchange’s electronic trading platform, as part of a broader strategy to attract more financial institutions to its markets.
The exchange’s latest project is an improved risk management system designed to give members a greater ability to manage trading risks. The new controls, which were rolled out in April, include a
pre-trade risk management system that will give member risk managers the ability to control or restrict their trader and client order placements based on a dynamic combination of set limits.
The upgrade also features a graphical user interface that alerts risk managers when an account breaches 75% and 90% thresholds and rejects trades that cross the 100% threshold. LME also introduced several new order types, including stop-loss orders with limits, good-till-date orders and good-till-time orders.
The exchange has recently implemented several other changes to its electronic trading system to encourage more liquidity in its markets, such as the removal of a 50-1 order to trade ratio and adding the option to place bids and offers on regular monthly dates. LME also is creating incentives for firms to act as liquidity providers at standard points on the curve.
