The process by which invest on margin accounts are credited or debited to reflect daily trading gains or losses is referred to as the ____ process.
A) Hedge rationing
B) Daily settlement
C) Marked-to-market
D) Book-to-market
E) Account realization

Question

Quizplus · Accepted Answer

The process of crediting or debiting margin accounts to reflect daily gains or losses is known as marked-to-market. This is a common practice in futures and options markets where the value of the underlying asset can change frequently. The process involves adjusting the account balance of the investor based on the current market price of the underlying asset. This helps to ensure that investors have enough margin to cover their trading losses and also helps to prevent the accumulation of large losses that can result in the liquidation of the investor's position.

The Process by Which Invest on Margin Accounts Are Credited