Quant interview prep guides

Absorbing State Probability Interview Questions

Absorbing state probability interview prep for terminal states, hitting probabilities, expected times, random walks, and gambler ruin.

Candidates practicing gambler ruin, random walks, and finite-state processes.

What absorbing means

An absorbing state is a state that ends the process or keeps the process there once reached. Win, lose, bankrupt, completed, and ruined states are common examples.

Separate transient states

The interesting equations usually live in the nonterminal states. From those states, a next step can move closer to one absorbing outcome or another.

Hitting probability setup

Set the target absorbing state to probability 1 and the other absorbing states to probability 0. Then write first-step equations for the intermediate states.

Expected time setup

Expected time to absorption uses a different equation: one step now plus expected remaining time after the next move.

Concrete example

In gambler ruin, reaching the upper bankroll target and reaching zero are absorbing states. The current bankroll is the state variable.

Common mistakes

Candidates often mix hitting-probability equations with expected-time equations. Decide which quantity is being asked before writing recurrences.

Practice the pattern

Use the LeetQuidity curriculum and calibration to turn this topic into a focused practice plan.