LME Facts

The reason the prices quoted on the screen are a 3M prompt date is because that was the approximate length of a voyage for a vessel carrying copper from Chile to the UK and tin from Malaysia to the UK at the time the exchange was founded.

The area where traders shout prices across to each other is known as the ring. While today the ring comprises red leather sofas set in a circle, it originally got its name when metals trading moved to the Jerusalem Coffee House in the early 19th century. When all the traders had gathered, a circle would be drawn in chalk on the floor, and they would stand around the ring to trade.

The last official session of the day is called the kerb and is now carried out electronically. The kerb gets its name from the same era as the chalk ring. In the early days of the LME, traders who wanted to continue trading after time was up would step outside onto the street and trade on the kerb of the pavement (curb of the sidewalk).

Why is the third Wednesday of each month the most liquid/default prompt date? The LME chose the third Wednesday of each month because no UK or US bank holiday ever falls on that date. Because the exchange settles in dollars, it needs both the UK and US markets to be open.