Mark Price
The mark price enhances market stability by reducing forced liquidations during abnormal volatility and is used to calculate unrealized profit and loss (PnL) for positions.
Mark Price Calculation
The mark price is determined by multiple market factors and is calculated as the median of three components: Price 1, Price 2, and the latest transaction price.
Formula: Mark Price = Median(Price 1, Price 2, Latest Transaction Price)
Price 1
Formula: Price 1 = Index Price × (1 + Funding Fee Basis Rate)
Funding Fee Basis Rate: Funding Fee Basis Rate = Funding Rate × (Time to Next Funding Fee Settlement / Funding Fee Interval)
Determined by the current funding rate and the time remaining until the next funding fee settlement.
For details, see: Funding Rate and Funding Fee Calculation.
Price 2
Formula: Price 2 = Spot Index + Moving Average Basis
Moving Average Basis: Moving Average Basis = SUM(Sampled Basis) / Number of Samples
Basis: Basis = (Best Bid Price + Best Ask Price) / 2 - Index Price
Sampling: The sampled basis is typically a collection of basis calculations taken every second over the past 5 minutes. The platform dynamically adjusts the sampling time window based on market volatility to ensure the mark price remains fair and resistant to manipulation.
Fallback Mechanism
If the spot index components are unreliable and cannot serve as a reference for contract pricing, the platform prioritizes in-house contract quotes as the primary reference for the mark price.
Volatility Protection
To prevent malicious market manipulation, a mark price instantaneous fluctuation protection mechanism is activated for certain markets.
If the latest mark price deviates significantly from the average over the past few minutes, updates to the mark price are paused, and the previous mark price is retained.
Updates resume when:
The normally calculated mark price returns to the pre-deviation level, triggering immediate resumption of normal updates, or
After a set period, if the mark price remains divergent, it smoothly transitions back to the normally calculated value.
Mark Price Applications
Unrealized Profit and Loss (PnL) Calculation
Long Position: Unrealized PnL = Contract Quantity × Contract Multiplier × (Mark Price - Entry Price)
Short Position: Unrealized PnL = Contract Quantity × Contract Multiplier × (Entry Price - Mark Price)
Position Value Calculation
USDT-Margined Perpetual Contracts: Position Value = Contract Quantity × Contract Multiplier × Mark Price
BTC-Margined Perpetual Contracts: Position Value = Contract Quantity × Contract Multiplier / Mark Price