Skip to main content
Learn

What Is the Benefit of Daily Cash Settlement for the Overall Market Stability?

It prevents the accumulation of large losses, reducing the risk of a major participant default and protecting the overall market integrity.
Greeks.Live03.11.25

What Is the Benefit of Daily Cash Settlement for the Overall Market Stability?

Daily cash settlement through MTM enhances market stability by preventing the accumulation of massive, unmanageable losses. By settling gains and losses daily, the system reduces the likelihood of a major default by any single participant.

It ensures that the clearing house's exposure to any trader remains small and manageable, thus protecting the integrity of the entire market.

How Does MTM Reduce Systemic Risk in the Financial System?
How Does MTM Affect the Cash Flow of a Futures Trader?
Does the MTM Process Eliminate All Systemic Risk?
Why Do Futures Exchanges Require Daily ‘Marking to Market’?

About

Contact

Editorial Policy

Terms of Service

Privacy Policy

Cookie Policy

© 2025 Greeks.Live

All Rights Reserved

Greeks.Live RFQ

Build by Noo on Engine

Source: The content on this website is produced by Greeks.live's proprietary analysis systems, which utilize advanced Large Language Models (LLMs). This information might not be subject to a full human review before publication and may contain errors.
Responsibility: You should not make any financial decisions based solely on the content presented here. We strongly urge you to conduct your own rigorous due diligence and to consult a qualified, independent financial advisor.
Purpose: All information is intended for informational purposes only. It should not be construed as financial, investment, trading, or any other form of professional advice. News and data are not trading signals.
Risk: The cryptocurrency, derivatives, and options markets are highly volatile and carry significant risk. By using this site, you acknowledge these risks and agree that Greeks.live and its affiliates are not responsible for any financial losses you may incur.