Mark to Market (MTM)

MTM is an accounting measure that values accounts to the current environment. Firms use mark-to-market accounting when the value of an asset or liability moves over time.

Bear Stearns, the now defunct investment bank purchased by JP Morgan, reported in June and July of 2007 that its two main hedge funds (the Bear Stearns High-Grade Structured Credit Fund and High-Grade Structured Credit Enhanced Leveraged Fund) had to mark down nearly all their value, sparking concerns of contagion in the financial crisis. Banks across Wall Street suffered huge paper losses thanks to MTM.