What is Mark To Market (MTM)?

Описание: MTM is the process of daily revaluation of a security to reflect its current market value instead of its acquisition price or book value. Also called marked to market or marking to market.
During the economic crisis and the banking crisis many banks and investment companies were forced to change their asset valuations to mark to market. Many mortgage companies were keeping loans on their books based on the price at acquisition when the true value was a lot lower. Mark-to-market or fair value accounting refers to accounting for the "fair value" of an asset or liability based on the current market price, or for similar assets and liabilities, or based on another objectively assessed "fair" value.[citation needed] Fair value accounting has been a part of Generally Accepted Accounting Principles in the United States since the early 1990s, and is now regarded as the "gold standard" in some circles.

By Barry Norman, Investors Trading Academy.