Hull-White (Mark)

The Hull-White (Mark) model is a mathematical framework used to accurately predict how interest rates will change over time. It assumes interest rates are somewhat unpredictable but tend to revert toward a long-term average, capturing the natural fluctuations seen in markets. This model helps lenders, investors, and financial institutions evaluate the risk and fair value of interest-sensitive products like bonds or loans. By incorporating time-dependent factors, it provides a flexible and realistic way to simulate interest rate movements, aiding in better financial planning and risk management.