Two years ago, the London Metal Exchange made the unprecedented decision to cancel $12bn of nickel trades. A short squeeze had sent the price of the metal above $100,000 per tonne, creating a margin call of $19.75bn.
The backlash was swift. Traders were incredulous that the LME would take such a drastic step to cancel a day’s worth of executed trades.
The decision would spawn half a dozen lawsuits, with the court ultimately ruled in the LME’s favour in November. One plaintiff — Elliott Management — said they would appeal.
The exchange still carries reputational damage from the day, and is trying to rebuild confidence as it works its way through a series of reforms.
Here is how Financial News has covered the saga over the past two years:
London Metal Exchange suspends nickel trading as Russia jitters send price to record
Hedge fund titan Clifford Asness leads trader fury after LME cancels $4bn in nickel trades
LME declares some nickel trades ‘null and void’ as chaos plagues market for third week
Metals guru on the ‘apoplectic rage’ of nickel traders over LME debacle
AQR to review LME ties as exchange sees funds’ nickel positions plunge 30%
LME nickel debacle a sign commodities are next market stability risk, watchdog warns
Hedge fund boss Ken Griffin says LME was ‘incomprehensibly wrong’ to wipe $4bn in nickel trades
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Elliott Management sues London Metal Exchange for more than $456m over cancelled nickel trades
LME boss defends cancelling nickel trades to stop ‘multiple defaults’
LME mandates reports of OTC contracts after nickel blindside raised transparency issues
LME boss says he has a plan to win back trust after wiping $4bn in nickel trades
London court throws out hedge funds’ case against London Metal Exchange over $4bn nickel debacle
LME hit with new lawsuit from five investment firms
LME battles $4bn nickel whiplash a year after ‘chaotic, disorganised’ crisis
LME to overhaul margin requirements in wake of nickel crisis
Elliott, Jane Street tell court LME had ‘no power’ to cancel $4bn in nickel trades
LME acted ‘illogically and irrationally,’ lawsuit claims
LME tells court it halted a ‘death spiral’ with cancelled nickel trades
Seven things we learned from Elliott and Jane Street’s court battle with the LME
LME boss: ‘We need critical friends’
LME wins nickel court battle against Elliott and Jane Street
LME boss Chamberlain: Nickel crisis pushed us to ditch archaic rules
LME chief Matthew Chamberlain: ‘There’s always going to be criticism when you make a decision’
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