Generally, lenders use the most recent Index figure available as of the date 15 days before each interest rate adjustment date. (mortgage-x.com)
Plus, you're protected from drastic fluctuations in the market by interest rate ceilings and specified adjustment dates over the life of your loan. (firstcitizens.com)
Of course, with an ARM, there's also a risk that the interest rate will increase at the next adjustment date. (humbledollar.com)