Mark Price
A fair-value price used by derivatives exchanges to calculate unrealised P&L and trigger liquidations, preventing manipulation by last-traded price.
The mark price on a derivatives exchange is a calculated fair value for a contract, used to determine unrealised profit/loss and whether positions should be liquidated. It is intentionally different from the last-traded price of the perpetual or future itself, which can be manipulated by a large trader to trigger artificial liquidations.
For perpetual futures, the mark price is typically derived from a weighted average of spot prices across multiple major exchanges — making it much harder to manipulate than the exchange's own last-traded price. If your position's mark price falls below the maintenance margin requirement, liquidation is triggered based on the mark price, not the last trade.
Understanding the mark price is essential for risk management in leveraged trading. During extreme volatility, the mark price can diverge significantly from the perpetual's last-traded price, which can either protect traders from unfair liquidations (if the last trade is anomalously low) or trigger liquidations that seem premature based on the last-traded price alone.