The Hindu Business Line  Jan 2  Comment 
Banks may face mark-to-market (MTM) losses aggregating about ₹15,500 crore on their investment portfolios in the October-December 2017 quarter due to surge in the yield on the benchmark 10-Year Gover...
SeekingAlpha  Dec 11  Comment 
The Economic Times  May 26  Comment 
MF companies found no buyers for the bonds even if they were trading at 18-19% discount.
Forbes  Jan 15  Comment 
In a recent opinion, the Sixth Circuit considered the operation of section 1256’s mark to market rule for foreign currency contracts as applied to a euro put option and reversed the United States Tax Court.
Automotive World  Jan 7  Comment 
Company builds upon significant pension funding and de-risking progress made to date Mark-to-market recognizes current performance of pension and OPEB plans; no effect on cash, pension funding requirements or employees’ pension and OPEB benefits...
SeekingAlpha  Dec 21  Comment 
Herbalife (HLF) released its audited results on Monday. This week, the stock has been on a tear. Today the stock broke through $80 for a Market Cap of $8 billion plus. In all likelihood, the company is back in the market repurchasing shares...
The Globe and Mail  Dec 5  Comment 
Mark Wahlberg takes a turn as a celebrity broker for charity  Nov 15  Comment 
Visit at for the full story.
Forbes  Feb 14  Comment 
Finally, an op-ed article on tax policy in The New York Times that isn’t horribly flawed!  In a piece last week entitled “The Zuckerberg Tax”, tax attorney David Miller proposes a new tax on the ultra-rich.  He would apply the tax to...


Mark-to-market is an accounting practice by which companies value and report their assets, especially financial instruments, at market price. Market price basically refers to the price at which the asset, or a similar asset, is trading at in a public exchange. The concept is derived from the accounting principle of prudence.

This is different from mark-to-model where the asset value is based on management's assumptions.

Mark-to-market accounting is typically used for Level 1 and Level 2 assets. In the case of Level 1 assets there is typically an actively traded exchange for that asset, e.g. for most stocks, a market price can be found easily. Level 2 assets are not traded actively, but it is possible to determine their prices based on prices of other similar assets; e.g. bonds of comparable quality. On the other hand, mark-to-market accounting is not used for Level 3 assets since they cannot be reasonably compared to any market price.

Mark-to-market accounting is always used in valuing futures contracts. The final value of a contract is not known till its expiration, but at the end of each day the value of the contract is adjusted to reflect the closing price for that date.

Numerical Example

Suppose an investor owns 100 shares of a stock purchased for $40 per share. However, that stock has increased in price, now trades at $60. The "mark-to-market" value of the shares is equal to (100 shares × $60), or $6,000, whereas the book value might (depending on the accounting principles used) be $4,000, based on the price paid for those stocks.

Similarly, if the stock falls to $30, the mark-to-market value is $3,000. In this case, the investor has lost $1,000 of the original investment. If the stock was purchased on margin, this might trigger a margin call and the investor would have to come up with an amount sufficient to meet the margin requirements for his account.


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