What is meant by EOD MTM (End of Day – Mark To Market) process?

EOD MTM on daily basis is a mandatory requirement in case of futures. Every day the settlement of open futures position will take place at the closing price of the day. The base price as shown in the Open Position – Futures page is compared with the closing price and difference is cash settled. In case of profit in EOD MTM, limits are increased by the profit amount and in case of loss, limits are reduced to that extent. Next day the position would be carried forward at the previous trading day closing price at which last EOD MTM was run. Closing price for all the contracts are provided by exchange after making necessary adjustment for abnormal price fluctuations. It is different than LTP.

 

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