# Index Price and Mark Price

### Index Price (Oracle Price)

This represents the aggregated spot price from major exchanges. To ensure high accuracy and fairness, we source data from both CoinGecko and CoinMarketCap APIs. CoinGecko collects price information from over 1,100+ centralized and decentralized exchanges, while CoinMarketCap aggregates data from more than 790+ exchanges. We update the index price every 5 seconds, allowing us to reflect market changes in near real-time. By relying on these comprehensive aggregators — each pulling data from hundreds of trading venues — our index price reflects a more objective and fair market value.

### Last Trade Price

The price of the most recent transaction on EVEDEX.

### Mark Price

This is the calculated price of an asset used to prevent market manipulation and excessive liquidations of positions. It represents a fair price that approximates the actual market value of the asset. Unlike the Last Trade Price, the Mark Price considers the current transactions on the exchange and other factors to smooth out fluctuations and ensure fairness for all market participants.

The Mark Price is commonly used in the following scenarios:

* **Determine liquidations**: If the asset's price rises or falls to a certain point based on the Mark Price, the platform may forcibly close traders' positions to prevent losses exceeding their available balance.
* **Reduce manipulation**: Using an average price and minimizing reliance on sharp fluctuations on a single exchange, the Mark Price protects against situations where someone might artificially manipulate prices to trigger liquidations.

Additionally, Mark Price is actively used in multiple aspects of the trading system:

* **Order execution and position closing**: Traders can place orders based on the Mark Price, and it can be used to automatically close positions when necessary.
* **Take Profit / Stop Loss (TP/SL) orders**: Mark Price is used for setting and executing Take Profit (TP) and Stop Loss (SL) orders, ensuring fair liquidation conditions.
* **Displayed on price charts**: The Mark Price is visually represented on price charts, allowing traders to track its movements in real-time.
* **Unrealized PnL calculation**: Since liquidations occur based on the Mark Price, we optionally provide an unrealized PnL (Profit and Loss) based on Mark Price for transparency.

### The Mark Price Formula

Mark Price = Median (Price 1, Price 2, Last Traded Price)

* Price 1 = Index Price × \[1 + Funding Rate × (Time Until Funding / 8)]
* Price 2 = Index Price + Moving Average (5-minute Basis)
* Moving Average (5-minute Basis) = Moving Average \[(Bid1 + Ask1)/2 − Index Price], measured every second within a 5-minute interval.

**Example for Price 1:**

* Index BTC Price: 58,543.43 USDT
* Funding rate: 0.054%
* Next funding rate in 4 hours 35 minutes
* Interval: 8 hours

Calculation: 58,543.43 × (1 + 0.00054 × (4.35/8)) = 58,543.43 × 1.000294 = 58,545.15

**Example for Price 2:**

* Index BTC Price: 58,543.43 USDT
* Ask = 58,496.14
* Bid = 58,495.52
* Moving Average (5-minute Basis) = Moving Average \[(58,495.52 + 58,496.14)/2 − Index Price] = 58,495.83 - 58,543.43 = -47.6

Price 2 = 58,543.43 + (-47.6) = 58,495.83

**Final calculation:**

Let's say the Last Traded Price is 58,496.1

Mark Price = Median(58,545.15, 58,495.83, 58,496.1)

Mark Price = 58,496.1


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