Frequently Asked Questions On Quant Interviews Best — 150 Most

| # | Question | Difficulty | Key Idea | |---|----------|------------|-----------| | 136 | What is the Black-Scholes formula? | ★★ | C = S N(d1) – K e^-rT N(d2) | | 137 | What is a call option? Put option? | ★ | Right to buy/sell | | 138 | What is delta? | ★ | ∂C/∂S | | 139 | What is gamma? | ★ | ∂²C/∂S² | | 140 | What is implied volatility? | ★★ | Vol that makes BS price match market | | 141 | What is the volatility smile? | ★★ | IV varies with strike | | 142 | What is the risk-neutral measure? | ★★★ | Measure where discounted prices are martingales | | 143 | What is a swap? | ★ | Exchange cash flows | | 144 | What is a futures contract? | ★ | Standardized forward | | 145 | What is the difference between hedging and speculation? | ★ | Reduce risk vs seek profit | | 146 | What is value at risk (VaR)? | ★★ | Loss quantile | | 147 | What is the Sharpe ratio? | ★ | (Return – RF)/Volatility | | 148 | What is the Greeks for options? | ★ | Delta, Gamma, Vega, Theta, Rho | | 149 | What is a binomial tree for option pricing? | ★★ | Discrete-time model | | 150 | What is put-call parity? | ★ | C – P = S – K e^-rT |

: Urn A contains 5 white and 2 red balls. Urn B contains 3 white and 3 red balls. A ball is drawn from A and placed into B, then a ball is drawn from B and is black. What is the probability the first ball was red? 150 Most Frequently Asked Questions On Quant Interviews

Given an array of stock prices, how do you find the maximum profit from buying and selling once in System Architecture & Language Deep Dives | # | Question | Difficulty | Key