Delivery Points
As a market of “last resort”, industry can use the LME’s delivery option to sell excess stock in times of oversupply and as a source of material in times of extreme shortage. In reality, physical delivery occurs in a very small percentage of cases on the LME as most organizations use the LME for hedging purposes. However, the small percentage, which does result in delivery, plays a vital role in creating price convergence.
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Famous quotes containing the words delivery and/or points:
“There was no speculation so promising, or at the same time so praisworthy, as the United Metropolitan Improved Hot Muffin and Crumpet Baking and Punctual Delivery Company.”
—Charles Dickens (1812–1870)
“He is the best sailor who can steer within the fewest points of the wind, and extract a motive power out of the greatest obstacles. Most begin to veer and tack as soon as the wind changes from aft, and as within the tropics it does not blow from all points of the compass, there are some harbors which they can never reach.”
—Henry David Thoreau (1817–1862)