3. Measuring standalone risk using realized (historical) data Aa Returns eaned over a given time period are called realized neturns. Historical data on realized returns is often usecd to estimate future results. Analysts across companies use realized stock returns to estimate the risk of a stock. Consider the case of Happy Dog Soap Inc. (HDS) Five years of realized returms for HDS are given in the following table. Remember 1. While HDS was started 40 years ago, its common stock has been publicy traded for the past 25 2. The returns on its equity are calaulated as arithmetic returns. 3. The historical returns for HDS for 2012 to 2016 are 2012 2013 2014 2015 2016 Stock return 15.00% 10.20% 18.00% 25.20% 7.80% Given the preceding data, the average realzed return on HDS's stock is The preceding data series represents standard deviation of HDS's historical retures is of HDS's historical eturns. Based on this concusion, the It investiors epect the average realieed return from 2012 to 2016 on HDS's stock to continue into the uture,it coefficient of variation (cv) will be 3 6 ps lock B. control optioncommand