Hedge funds sue London Metal Exchange for £80m after reversing billions of dollars in nickel trades
The London Metal Exchange (LME) is being sued by a group of hedge funds for £80m after reversing billions of dollars worth of nickel trades.
LME, the world’s largest metals exchange, suspended nickel trading after a dramatic price spike last March, outraged investors.
AQR Capital Management, DRW Commodities, Flow Traders, Capstone Investment Advisors and Winton Capital Management are seeking damages for their alleged losses.
Legal battle: LME, the world’s largest metals exchange, suspended nickel trading after a dramatic price spike last March, outraged investors
Hong Kong Exchanges and Clearing, owner of the LME, insisted the claim “is baseless”.
The LME is also facing legal action from New York-based hedge fund Elliott Associates seeking damages worth £379m, while Jane Street Global Trading is seeking £12.7m .
Nickel trading was suspended after prices doubled to more than $100,000 a ton in just hours – a push industry insiders blamed on short hedging by a producer.
The UK’s financial watchdog, the Financial Conduct Authority, has launched an investigation into the LME for possible misconduct.
