Ajay Bohra
Last updated: May 2026 · For Indian traders holding F&O or margin positions. Not investment advice.
This page explains Mark to market (MTM) in plain language for Indian investors reading market terminology.
Mark to market (MTM) is the daily revaluation of open positions at current market prices. If you trade futures or options, MTM drives the profit or loss you see before you close the trade — and it affects margin calls.
MTM at a glance
| Term | Meaning for you |
|---|---|
| Mark to market | Recalculate position value using today’s price |
| MTM profit | Gain if you closed at the current quote |
| MTM loss | Loss if you closed at the current quote |
| Settlement | Cash adjustment posted to your ledger (F&O) |
Simple example (futures)
- You buy 1 Nifty futures lot at 22,000.
- At 3:30 PM the index is 22,150 → positive MTM (before costs).
- Next day index is 21,900 → MTM turns negative even if you still hold the lot.
- Brokerage, STT, and other charges are separate — use our brokerage calculator.
MTM vs investing in stocks (delivery)
| Delivery equity | F&O (MTM-heavy) | |
|---|---|---|
| Price shown in portfolio | Last traded price | MTM P&L daily |
| Margin | Full cash for purchase | SPAN + exposure margin |
| Risk | Company fundamentals + market | Leverage + time decay (options) |
Where MTM shows up on your broker
Indian brokers display MTM on:
- Positions / holdings screen (F&O tab)
- Funds statement (daily credit/debit)
- Contract note after exit
Charges differ by broker — compare before you size up F&O:
Related terms
- Secondary market — where MTM prices come from
- Leverage — why MTM matters more with borrowed exposure
FAQ
Is MTM the same as realised profit?
No. MTM is mark-to-market on open positions. Realised profit/loss hits when you square off.
Can MTM force me to deposit more money?
Yes, if losses erode margin below broker/exchange requirements — you may get a margin call or auto square-off.
Risk warning: F&O trading can cause losses beyond your initial margin. See disclaimer.
FAQs
What is mark to market?
Daily revaluation of open positions to the latest market price.
Who uses MTM?
Brokers for F&O margin; funds for NAV; exchanges for derivatives settlement.
Can MTM cause margin calls?
Yes, adverse daily moves can trigger additional margin requirements.
