Mark To Market
The daily revaluation of open futures positions that credits or debits your profit and loss every single trading day.
Definition
Mark to market (MTM) is the daily process of revaluing an open futures position against the day's settlement price. Any gain is credited to your trading account and any loss is debited — in cash — at the end of each trading day. This resets your position's cost basis to the latest settlement price, so MTM is settled afresh every day until the position is closed or expires.
Why it matters
MTM means futures profit and loss is real cash that moves daily, not a paper number you only realise at exit. A run of adverse days can drain your account through cumulative MTM debits, and if your balance falls below the required margin you face a margin call. Understanding MTM is essential for managing the cash flow and liquidity of any leveraged futures position.
Example
You buy one lot of an index future at 22,000. By the day's settlement, it closes at 22,100 — a 100-point gain, which is credited to your account that evening. The next day it settles at 21,950, a 150-point fall from the prior settlement, so that loss is debited. Each day's MTM is measured from the previous settlement, not your original entry.
See it live
Follow index levels and futures behaviour in real time on TradePulse's live option chain to anticipate your daily MTM.