> For the complete documentation index, see [llms.txt](https://references.everstrike.io/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://references.everstrike.io/trading/mark-price-compensation.md).

# Mark Price Compensation

Traders on Everstrike that trade far away from the current Mark Price will need to put up additional Position Margin that covers the difference between their Weighted Average Fill Price and the current Mark Price.\
\
If a trader trades 1.00% away from the current Mark Price, a Minimum Initial Margin requirement of 1.00% will increase to 2.00%:

`Old Minimum Initial Margin = 1.00% + 0.00% = 1.00%`

`New Minimum Initial Margin = 1.00% + 1.00% = 2.00%`

The purpose of this is to ensure that the trader does not have his position enter liquidation immediately upon being filled in the market. If the Minimum Initial Margin Requirement would remain at 1.00% and the trader is filled 1.00% away from the Mark Price, the trader's position could potentially go bankrupt right after being opened.<br>


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