- Fair Market Pricing is used for liquidations and unrealized PNL.
- Although the Mark Price may temporarily deviate from actual market traded prices, ACDX's Fair Market Pricing prevents market manipulation and excessive liquidations.
The Mark Price is a function of the Index Price and current market prices and is calculated in 2 steps.
1. Fair Price = (Impact Bid + Impact Ask) / 2
- Impact Bid =
- clearing price to fill a 0.05 (or impact mid qty) contract market sell order
- or the best bid price - 0.1% (or impact mid threshold), which ever has a greater value
- Impact Ask =
- clearing price to fill a 0.05 (or impact mid qty) contract market buy order
- or the best offer price + 0.1% (or impact mid threshold), which ever has a lower value
|Underlying||Impact Mid Qty||Impact Mid Threshold|
2. Mark Price = Index + 10 second EMA (Fair Price - Index)
- Hard limited by Index +/- Mark Price Band %
- Trading can still occur outside these bands
- Calculated every 1 second