LME Settlement Rules

LME has a unique settlement system, and its settlement is handled by LCH (London Clearing House). LME’s 3M standard contracts are delivered on a daily basis, ensuring that there are contracts for delivery on every trading day in the LME market. The LME contract will not be settled or physically delivered until the expiry date. It means the profit part can only be withdrawn after the contract expires. Assuming that a contract bought on 1st February, the expiration date is on 1st May, and the contract was closed on 1^st March, the profit (if any) has to be kept in the futures account until the expiration on 1^st May. However, the profit can be used to open a position. In short, the funding of initial margin can be withdrawn from the client account, but profit has to kept until the date of contract expiration.