Hedge funds sue London Metal Exchange for £80m over nickel debacle
Hedge funds are suing London Metal Exchange for £80 million after it canceled billions of dollars worth of nickel trading
The London Metal Exchange (LME) is being sued by a group of hedge funds for £80 million after canceling billions of dollars worth of nickel transactions.
LME, the world’s largest metals exchange, suspended trading in nickel after a dramatic price spike last March, angering 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 in March last year, outraging investors
Hong Kong Exchanges and Clearing, owner of the LME, insisted the claim is “baseless”.
The LME also faces a lawsuit from New York hedge fund Elliott Associates, seeking £379m in damages, while Jane Street Global Trading is pushing for £12.7m.
Nickel trading was suspended after prices doubled to more than $100,000 a ton in just a few hours — an increase that industry insiders blamed on a producer failing.
The UK’s financial watchdog, the Financial Conduct Authority, has launched an investigation into the LME for possible misconduct.