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Traded Average Price Options (TAPOs) give the metal community a flexible way of hedging against fluctuations in the Monthly Average Settlement Price (MASP).

This is particularly useful because a large proportion of physical contracts are negotiated basis the MASP.

Like traded options, a buyer of a TAPO has the right, but not the obligation, to buy or sell at a price agreed today. The settlement price is calculated based on the average settlement price of the month.

Want to learn more?

Register for our Hedging with Options training course to learn more about the basics of hedging on the LME. The course looks at market terminology, trading strategies and margining of LME contracts.

TAPOs (Traded Average Price Options)

Asian-style monthly average-price options
up to 63 months