Mark Price

The mark price is the reference price Rails uses for a perpetual market. Margin requirements, unrealized PnL, and liquidations are all based on the mark price rather than the index price — see Position Metrics and Risk Management for how it feeds those calculations. Funding is the one calculation that stays on the index price directly — see Funding.

Key Definitions

Term	Description
`indexPrice`	The external index price — the asset’s spot price aggregated from major markets outside Rails (see Index Price Sources)
`bid`, `ask`	Rails best bid and best ask
`last`	Last trade price on Rails
`railsMedian`	`median(bid, ask, last)` on Rails — where Rails’ own market currently prices the asset
`premiumSample`	`(bid + ask) / 2 - indexPrice` — the instantaneous gap between Rails’ mid-price and the index, before the EMA smooths it over time
`t`	Seconds elapsed since the previous update — the weight of the current premium sample
`EMA`	Exponential moving average of `premiumSample`, with a 2.5-minute time constant — see The Premium EMA below
`adjustedIndex`	`indexPrice + EMA` — the index price plus the exponential moving average of the premium of Rails’ market over the index

How It’s Calculated

The mark price is the median of three values:

markPrice = median(adjustedIndex, railsMedian, indexPrice)

Value	What it represents
`indexPrice`	The external index price
`railsMedian`	`median(bid, ask, last)` on Rails
`adjustedIndex`	`indexPrice + EMA` — the index price plus the smoothed premium (see below)

Two of the three values are anchored to the external index. That means Rails’ own order book can pull the mark price toward itself, but it can never run away with it: the mark can only deviate from the index by as much as the smoothed, time-averaged premium, never by the size of a momentary spike.

The Premium EMA

Rails’ market naturally trades slightly above or below the index — that gap is the premium:

premiumSample = (bid + ask) / 2 - indexPrice

Rather than using the instantaneous gap, adjustedIndex uses an exponential moving average (EMA) of the premium with a 2.5-minute time constant. Recent samples count the most and older samples fade out smoothly, and samples are weighted by how long they were in effect. A one-second spike in the book barely moves the average; a persistent premium shifts it over minutes. The EMA is computed from a pair of decaying sums, updated on every tick, t seconds after the previous one:

numerator   → numerator   × e^(-t / 150s) + premiumSample × t
denominator → denominator × e^(-t / 150s) + t

EMA = numerator / denominator

Update Frequency

The mark price updates on every index price tick, at most once every 250 milliseconds per market. All arithmetic is exact decimal (no floating point drift), and the published price is rounded to the price increment of 0.0000001.

When Inputs Are Unavailable

A market can temporarily be missing some of its own input. Whenever that happens, the mark price falls back to the index price instead of going stale:

Situation	Mark price
No Rails quotes yet (empty order book)	Index price
Quotes exist, but no trades yet	Index price — the premium EMA already starts accumulating from the quotes, so it is warmed up when the first trade prints
Quotes and at least one trade exist	Full formula

Fallback updates follow the same 250 millisecond cadence as normal updates.

Usage in API

The mark price is published as a MARK entry from the Get Market Data endpoint, with value holding the price. See Position Metrics for the PnL formula and Risk Management for how the mark price drives liquidation.

Guides

Formulas

WS Reference

API Reference

Key Definitions

How It’s Calculated

The Premium EMA

Update Frequency

When Inputs Are Unavailable

Usage in API

​Key Definitions

​How It’s Calculated

​The Premium EMA

​Update Frequency

​When Inputs Are Unavailable

​Usage in API

Key Definitions

How It’s Calculated

The Premium EMA

Update Frequency

When Inputs Are Unavailable

Usage in API