Term:
Marking to market
Definition:
The process of recalculating the exposure in a trading position in securities, option contracts or futures contracts. In exchange-traded contracts, the exchange clearing house marks members' positions to market each day using closing market prices. Members must maintain a certain minimum level of margin at the exchange clearing house and must post additional margin if the marking-to-market process reduces margin below the minimum.
Domain:
Finance
Source:
World Bank: Glossary of Finance and Debt