> ## Documentation Index
> Fetch the complete documentation index at: https://docs.kimia.live/llms.txt
> Use this file to discover all available pages before exploring further.

# Mark Price

> How the price used for PnL, margin, and funding is computed.

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Mark price is the single source of truth for:

* Unrealized PnL
* Maintenance margin checks
* Funding rate TWAP inputs

It is **not** directly the oracle price, and it is **not** directly the last
trade price. It's the last trade price **clamped to the oracle within ±10%**.

## Formula

$$
\text{mark\_price} = \text{clamp}\!\left(\text{last\_trade\_price},\; \text{oracle} \times 0.9,\; \text{oracle} \times 1.1\right)
$$

If there has been no trade yet, `last_trade_price` defaults to the oracle price.

## Why clamped?

Without the clamp, a thinly-traded market could be manipulated, one fill at
+50% would make every long position look wildly profitable, passing margin
checks they shouldn't.

The 10% clamp window:

* Tight enough that adversarial trades can't push users into insolvency via
  mark alone.
* Wide enough that legitimate price discovery during a volatile hour still
  moves mark organically (versus just pinning it to oracle).

Liquidations bypass mark entirely, they run at oracle price, which has its own
confidence and staleness bounds.

## What updates mark

* **Every fill** updates `orderbook.last_trade_price` and `last_trade_ts`.
* **`update_funding_rate`** reads the current mark into the mark TWAP.
* **Admin param changes** never rewrite mark directly.

## TWAPs

Two 1-hour exponential moving averages are maintained on the `Market` account:

* `mark_twap`, 1-hour EMA of mark price
* `oracle_twap`, 1-hour EMA of oracle price

They feed the funding rate formula. See [funding rate](/concepts/funding-rate)
for how they're combined.

## Reading mark price off-chain

```ts theme={null}
const orderbook = await fetchOrderbook(rpc, orderbookPda);
const oracle = await fetchOracle(rpc, market.oracle);

const mark = clamp(
  orderbook.lastTradePrice,
  oracle.price * 0.9,
  oracle.price * 1.1,
);
```

Or, simpler: the frontend renders `math::get_mark_price(market, oracle)` server-side
via a Codama-generated helper.