Maximizing Profit: Best Time to Buy and Sell Stock

Introduction

The Best Time to Buy and Sell Stock problem is a common coding challenge that involves maximizing your profit by buying and selling a stock. In this article, we will explore an efficient solution to this problem using a simple approach. We will learn how to determine the best day to buy the stock and the best day to sell it in order to achieve maximum profit.

Problem Description

Given an array of stock prices, our goal is to find the maximum profit that can be obtained by buying and selling the stock. We can only make one transaction, which means we can buy and sell the stock only once. If no profit can be achieved, we should return 0.

Solution Approach

To solve the problem efficiently, we will use a simple approach. We will keep track of the minimum stock price seen so far and calculate the potential profit on each day. By updating the minimum price and comparing it with the current day's price, we can determine the maximum profit we can achieve. We will iterate through the array of stock prices, updating the minimum price and potential profit at each step.

Algorithm Steps

1. Initialize a variable to store the minimum price as the maximum possible value.
2. Initialize a variable to store the maximum profit as 0.
3. Iterate through the array of stock prices, starting from the first day:
• Check if the current price is less than the minimum price. If it is, update the minimum price.
• Otherwise, calculate the potential profit by subtracting the minimum price from the current price.
• If the potential profit is greater than the maximum profit, update the maximum profit.
4. Return the maximum profit as the result.

Python Implementation

def maxProfit(prices):
    min_price = float('inf')
    max_profit = 0

    for price in prices:
        if price < min_price:
            min_price = price
        else:
            profit = price - min_price
            if profit > max_profit:
                max_profit = profit
    
    return max_profit

# Example usage:
prices = [7, 1, 5, 3, 6, 4]
result = maxProfit(prices)
print(result)
      

Explanation

In the provided example, we have an array of stock prices [7, 1, 5, 3, 6, 4]. By running the `maxProfit` function with these inputs, we obtain the result of 5. This means that by buying the stock on day 2 (price = 1) and selling it on day 5 (price = 6), we can achieve a profit of 6 - 1 = 5. This is the maximum profit possible for this array of stock prices.

Conclusion

The Best Time to Buy and Sell Stock problem is a popular coding challenge that tests your ability to maximize profit by buying and selling a stock. By using a simple approach and keeping track of the minimum price and potential profit, we can efficiently solve this problem. The solution presented in this article provides an effective method to determine the best time to buy and sell the stock, ensuring maximum profit.