A measured displacement resolution of <3 nm is demonstrated with a common cathode differential photodetector combined with a laser-diode optical source and a fiber-optic collimator. Resolution, standard deviation, and differences between maxima and minima values for the residuals of the least-squares fit suggest that a coherent laser-diode source temporally correlates photoelectron flux between adjacent detector segments, suggesting reduced signal variance and associated electronic (shot) noise. For otherwise similar systems, the laser-diode source provides approximately an order of magnitude reduction in standard deviation compared with a light-emitting-diode source, which implies an equivalently improved measured (including standard deviation) resolution. Combined variances for correlated and uncorrelated detectors and their measured variances are outlined. The measured resolution is a sum of both the (ideal) mathematical variance based on the detector noise (millivolts) divided by the system sensitivity (millivolts per nanometer, and the standard deviation of the noise (nanometers).
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