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Medium · statistical_analysis · Quant Researcher interview question · statistics, variance-ratio, random-walk, market-efficiency, time-series
The Lo-MacKinlay (1988) variance ratio test is a canonical statistical test for the random walk hypothesis in asset prices. A ratio significantly different from 1.0 suggests the presence of autocorrelation, indicating either positive feedback (momentum) or negative feedback (mean reversion). This test provides a quantitative basis for selecting between trend-following and statistical arbitrage strategies for a given financial instrument. Task Implement the function solution(prices: list, q: int