characteristic function changes over time to remain in line with asset characteristics, eg when the underlying asset is a bond whose volatility dies down towards maturity
Characteristic function$$ \ldots $$
Indifference curve$$ \ldots $$
Price response function$$ \ldots $$
AMM portfolio value$$ \ldots $$
Divergence loss$$ \ldots $$
Whilst reasonable care has been taken to verify the above formulas they may still contain errors. Please do not use them without independent verification.