Quant interview prep guides

Random Walk Hitting Probability Interview Questions

Random walk hitting probability interview prep for states, boundary conditions, fair and biased walks, and gambler ruin intuition.

Candidates practicing state recursion and absorbing-barrier probability questions.

Define states and boundaries

A hitting probability asks which boundary a process reaches first. Define p_i as the probability of hitting the target boundary from state i, then write the boundary values.

Fair walk recurrence

For a fair walk with moves up or down one step, p_i = 0.5p_{i-1} + 0.5p_{i+1}. Boundary conditions determine the solution.

Concrete example

Starting at 1 with absorbing barriers at 0 and 3, p_0 = 0, p_3 = 1, and p_1 = 0.5p_0 + 0.5p_2. Solving the linear system gives p_1 = 1/3.

Biased walk intuition

If upward moves are more likely than downward moves, the hitting probability is higher than the fair-walk linear value. Name the transition probabilities before solving.

Do not add the time step

Hitting probability recurrences do not include a +1 term. Expected time recurrences usually do. Mixing the two is a common mistake.

Common mistakes

Candidates often forget boundary values or use expected-time equations for probability. Write the target, state, transitions, and boundaries first.

Practice the pattern

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