How Does the Mark Price Affect the Calculation of ‘Maintenance Margin’?
The mark price is used to calculate the current value of a trader's position and, consequently, their equity in the derivatives account. The maintenance margin is a percentage of this equity.
By using the mark price (the fair, oracle-derived price) instead of the last traded price, the exchange ensures that the calculation of a trader's margin and the subsequent liquidation threshold is based on a robust, manipulation-resistant value, protecting traders from unfair liquidations.
