Expected Trades Until 5th Win - Quant Trader Interview Question
Difficulty: Medium
Category: Probability & Statistics
Practice quant interview questions from top firms including Jane Street, Citadel, Two Sigma, DE Shaw, and other leading quantitative finance companies.
Topics: probability, expected-value, negative-binomial, trading-strategy
Problem Description
A quantitative trader employs a new trading strategy. Backtesting reveals that the strategy wins each independent trade with a probability of $p = 0.3$.
What is the expected number of trades the trader must execute until achieving their 5th winning trade?
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