The volatility process is , where t is the observation time and T
is the starting time of a forward rate.
In a stationary process, the volatility term is T–t. Multiple factors
can be specified sequentially.
The time values T, t, and Term
are
in coupon interval units specified by the Compounding
input of hjmtimespec
. For instance if Compounding
= 2
,
Term = 1
is a semiannual period (six months).