(Bloomberg) — The London Metal Exchange, the biggest metals bourse, will upgrade its network service to provide three access levels to its electronic systems, including one geared to high-frequency traders.
The LME is working with Colt Technology Services on the LMEnet project, which will provide connection to all of the exchanges systems including LME Clear, its clearing house, it said in an e-mailed statement today. The LME expects to move users to the new system within nine months of Colts technology being deployed and tested, starting from October, it said.
The premium package will link clients directly into LME data centers, providing dedicated low-latency connectivity, it said. The standard service is geared to providing trading, matching, clearing and market data for market participants not focused on low-latency trading, or buying and selling with a minimum of delay. High frequency trading involves using complex algorithms to transact a large number of orders at very fast speeds. LMEnet Remote is aimed for offices of one to two users.
The LME has invested more than 30 million pounds ($51 million) in the past 12 months in systems development and information technology, excluding LME Clear, according to the statement. The LME was purchased for $2.2 billion by Hong Kong Exchanges & Clearing Ltd. in 2012. Garry Jones, who formerly ran NYSE Liffe, became chief executive officer in September.
The exchange said Feb. 17 it will give members clients direct access to market data from its electronic trading system, helping traders using so-called algorithmic strategies because it might reduce the amount of time needed to make trades.
Last year, 171.1 million industrial metal contracts were traded on the LME with a value of $14.6 trillion. Prices used as a benchmark by producers, consumers and merchants are established by telephone, electronically and in the ring, Londons last open-outcry trading floor.
