Red/Black Card Game - Quant Trader Interview Question
Difficulty: Hard
Category: Betting Games
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, martingale
Problem Description
You are playing a card game with a standard deck of 52 cards, shuffled thoroughly. There are 26 red cards and 26 black cards. Cards are revealed one at a time.
For each red card revealed, you win 1 dollar. For each black card revealed, you lose 1 dollar. You can choose to stop the game at any time, keeping your current winnings.
What is the optimal strategy to maximize your expected winnings, and what is the resulting expected value (EV)?
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