A new full-vectorial beam propagation algorithm based on the versatile finite element method, in order to accurately characterize three-dimensional (3-D) optical guided-wave devices, is presented. The computationally efficient formulation is based on the two transverse components of the magnetic field without destroying the sparsity of the matrix equation. The robust perfectly matched layer (PML) boundary condition is incorporated into the formulation so as to effectively absorb the unwanted radiation out of the computational domain. The efficiency and precision of the proposed full-vectorial propagation approach is demonstrated through the analysis of single optical waveguide,directional couplers, and electrooptic modulator.
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