How Often Is the Mark Price Typically Updated by the Exchange?
The Mark Price is typically updated very frequently, often every second or even more often, to reflect the real-time changes in the underlying Index Price and the Funding Rate. For perpetual futures, the Index Price component is usually a moving average of multiple spot exchanges, which is updated continuously.
This constant updating ensures that the Mark Price remains a fair representation of the contract's true value, minimizing liquidation risk from stale data.
Glossar
Mark Price Calculation Error
Error ⎊ A discrepancy in the computed mark price, which serves as the basis for margin calculations and liquidation triggers, represents a critical failure in the derivatives pricing architecture.
Mark Price
Valuation ⎊ The Mark Price within cryptocurrency derivatives represents a fair value estimation, calculated to mitigate price manipulation and ensure orderly market functioning, particularly during periods of low liquidity or volatility.
Index Price Component
Index ⎊ The index price component, within cryptocurrency derivatives and options trading, represents a constituent element determining the valuation of an underlying index.
Minimizing Liquidation Risk
Collateral ⎊ Minimizing liquidation risk within cryptocurrency derivatives necessitates a rigorous assessment of collateral adequacy and management.