Marking-to-model

Marking to model values a position using a valuation model rather than an observed price, which is unavoidable for illiquid instruments. It creates discretion, and discretion over one's own reported profit is a standing conflict of interest.

history and doctrine · updated 2026-11-06

See also

• Mark to market — Marking to market is valuing a position at current market prices. Because it converts a price into reported profit, collateral and…
• Net asset value — Net asset value is the per-share value of a fund's holdings. For funds holding illiquid or stale-priced assets, the inputs to net …

Terms that refer here

Level 3 asset · Mismarking

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