'Marking to market' is a process of the clearinghouse whereby:
A)funds are demanded from each trader that incurs a loss.
B)funds are returned to each trader that earns a profit.
C)each trader's position is updated according to the average market price determined on that day.
D)each trader's position is adjusted according to the market price determined at the close of each trading day.

Question

Quizplus · Accepted Answer

Marking to market is a process of adjusting each trader's position according to the market price determined at the close of each trading day. This helps keep track of the current value of each trader's position and ensures that the overall risk in the market is managed effectively by the clearinghouse.

'Marking to Market' Is a Process of the Clearinghouse Whereby