How Does the Index Price Differ from the ‘Mark Price’ Used in Perpetual Futures Trading?

The Index Price is the true spot price benchmark from external exchanges. The Mark Price is the price used by the derivatives exchange for calculating unrealized Profit and Loss (PNL) and for triggering liquidations.

The Mark Price is often a blend of the Index Price and the moving average of the contract's actual trading price to prevent temporary market spikes from causing unfair liquidations.