Drift factor

Equation 10.30 is known as Stefan s Law(3). Thus the bulk flow enhances the mass transfer rate by a factor Cj/Cjj, known as the drift factor. The fluxes of the components are given in Table 10.1. 

It may be noted that all the transfer coefficients here are greater than those for equimolecular counterdiffusion by the factor (Cr/ )(= P/Pftm), which is an integrated form of the drift factor. 

Drew. T. B. 477, 497, 499, 564, 565 Drift factor 578, 580 Drops, mass transfer 651 Dropwise condensation 476 DRTlNA, P. 307.312 Drying calculations, example 749 Duckworth, R. A. 209. 228 Duct, non-circular 86... 

At steady state the rate of mass transfer must equal the reaction rate and, if one neglects the change in the number of moles on reaction, the drift factor may be taken as unity. Thus... 

The binomial tree model evaluates the return of a bond with embedded option by adding a spread to the risk-free yield curve. Generally, the price obtained by the model is compared to the one exchanged in the market. If the theoretical price is different, the model can be calibrated with three key elements. The first ones are the volatility and drift factor. They allow to calibrate the model interest rate path in order to obtain the equality with the market yield curve. The third one is the spread applied over the yield curve. Generally, when volatility and drift are correctly calibrated, the last element to select in order to obtain the market parity is the spread. Conventionally, banks define it in the following way ... 

The second one, is known as drift factor which defines the direction of the interest rate path. If we think that interest rates can be higher in the fumre, we can assume a positive drift factor. For instance, if at time tg we have an interest rate of 6% and we assume a drift factor greater than 0%, this means that the interest rate at time 2 will be higher than 6%. If the drift factor is equal to 0%, then the interest rate at time <2 will be equal than the one at time tg. This parameter is useful if we want to fit the model yield curve to the one observed in the market. If the market foresees an upward yield curve, we can calibrate the model with the market values at time of issue. 

Coming back with our hypothetical callable bond, the 6-month interest rate has the path illustrated in Figure 11.5. In the example, we assume a volatility of the period equal to 11%. Assuming a drift factor equal to 0%, the interest rate of 2.96% at time tg can reach at time ts a maximum value of 8.56% and a minimum value of 1.03%. In this case, the yield curve is flat and the interest rates in the base scenario at time tg, tj, t2, ts, t4 and ts are always equal (2.96%). 

Alternatively, if we think that interest rates will be higher in the future, we can assume a drift factor greater than 0%. In this case, we can calibrate the model yield curve with market yield curve. In other words, we adopt an iterative procedure in which we set the pricing error between the model and market yield curve equal to 0 by changing the drift factor. 

Thus, if the method developed in Section 12.4 is used to evaluate the concentration difference, this equation may be used to determine an approximate value for the temperature difference. [In many cases the drift factor term (in brackets) is essentially unity.]... 

In essence, the Fokker-Planck equation is a continuous equation, of temporary evolution of the electronic flux, compelled to an external potential V(x) with the drift factor and one of diffusion (stochastic noise). This thing can be easily notice if the Fokker-Planck equation is rewritten (5.250), as example, in a hydrodynamic form ... 

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