3. Measuring stand-alone risk using realixed (historical)data Retums eamed over a given time period are called realized returns. Historical data on realized retums is often used to estimate future results. Analysts across companies use realized stock returns to estimate the risk of a stock. Consider the case of Happy Deg Soap Inc. (HDS): Five years of realized returns for HDS are glven in the following table. Remember: 1. While HDS was started 40 years ago, its common stock has been publicly traded for the past 25 years. 2. The returns on its equity are calculated as arithmetic returns. 3. The historical returns for HDS for 2014 to 2018 are: Given the preceding data, the average realined return on HDS's stock is The preceding data series represents of HOS's histoncal returns: Based on this conclusion, the standard deviation of HDS's historical returns is If investors expect the average realized return from 2014 to 2018 on HDS's stock to continue into the future, its coeffichnt of vanation (CV) will be 3. Measuring stand-alone risk using realixed (historical)data Retums eamed over a given time period are called realized returns. Historical data on realized retums is often used to estimate future results. Analysts across companies use realized stock returns to estimate the risk of a stock. Consider the case of Happy Deg Soap Inc. (HDS): Five years of realized returns for HDS are glven in the following table. Remember: 1. While HDS was started 40 years ago, its common stock has been publicly traded for the past 25 years. 2. The returns on its equity are calculated as arithmetic returns. 3. The historical returns for HDS for 2014 to 2018 are: Given the preceding data, the average realined return on HDS's stock is The preceding data series represents of HOS's histoncal returns: Based on this conclusion, the standard deviation of HDS's historical returns is If investors expect the average realized return from 2014 to 2018 on HDS's stock to continue into the future, its coeffichnt of vanation (CV) will be