Why buying and selling stock on i and i +1 gives the maximal?

  • 0

    I do not understand why buying and selling stock on days gives the maximal profit,
    why buying stock on day i and selling the stock on day j where j - i > 1 is not possible to be better than this way? Is there a proof?

  • 4

    Actually,given 5,7,8:
    It is the same for the total profit if you

    1. buy(5),sell(7),buy(7),sell(8),making 3 profit
    2. buy(5),sell(8),also making 3 profit.

    You can draw a graph,the most profit is the sum of all these line segments which are increasing.

  • 0

    Thanks! I understand the case when it strictly goes up, but for a more general case,say i = 1 and j = 10 and we do not know the value for 2,3,4....,9, how do we guarantee that buying and selling the stock this way is better than buying it on day i and selling on day j

  • 0

    Say a sequence from i to j, if it is in a non-decreasing order, then the highest profit will be achieved by buying at day i and sell at day j. It's the same as you buy 1 and sell in the next day. If, it is NOT in a non-decreasing order, say at day k, the price goes down. Then you can always sell the share at day k-1, and buy 1 at day k to obtain even more profit.
    So to sum up, you will earn the max profit from the sum of each non-decreasing segment. The 2 ways to achieve the max profit are essentially the same, but the second one is easier to implement.

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