Mark price

The reference price an exchange uses to value open positions, calculate unrealised profit and loss, trigger liquidations and fire trigger orders. It is deliberately built to be harder to manipulate than the last traded price.

Definition

The mark price is the exchange’s own view of what a contract is worth right now. It is derived from external and internal price sources rather than simply taken from the most recent trade, which is why it can differ from the number at the top of the chart.

Why it is not the last traded price

The last traded price is whatever a single trade printed, and a single trade can be small, mistimed, or deliberate. If liquidations ran on that number, a large order into a thin book could push the price through a cluster of liquidation levels, harvest the positions, and let the price snap back.

Deriving the mark price from a broader basis removes most of the value in trying. It is a defensive design choice, not a cosmetic one.

Everything it decides

Unrealised profit and loss on open positions. Whether the maintenance margin is still met, and therefore whether you are liquidated. Where the liquidation price sits. On most venues, whether a trigger order fires. And it is one half of the funding rate calculation, which compares the perpetual against the underlying spot price.

What this means for you

Your stop can fail to fire during a visible wick, because the mark price never went there. Your position can be liquidated while the chart you are watching shows a better price. Neither is a bug.

Each exchange constructs its mark price differently, and the construction is published. It is worth reading once for the venue you actually trade on, because it defines the conditions under which you lose a position.

Where you will run into it

As a column in the positions panel, as the trigger source setting on take-profit and stop-loss orders, and in the funding rate figures on any perpetual DEX.