3. Measuring stand-alone risk using realized (historical) data Returns earned over a given time period are called realized returns. Historical data on realized returns 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 Dog Soap Inc. (HDS): Five years of realized returns for HDS are given 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: 2014 3.75% 2015 2.55% 2016 4.50% 2017 5.30% 2018 1.95% Stock return Given the preceding data, the average realized return on HDS stock is of HDS's historical returns. Based on this conclusion, the standard deviation of HDS's The preceding data series represents historical returns is Ch 08: Assignment - Risk and Rates of Return 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: 2014 3.75% 2015 2.55% 2016 4.50% 2017 6.30% Stock return 2018 1.95% Given the preceding data, the average realized return on HDS's stock is The preceding data series represents historical returns is . of HDS's hist 9.53% ns. Based on this conclusion, the standard deviation of HDS's 3.81% If investors expect the average realized return from 2014 to 2018 on Hd 11.81% o continue into the future, its coefficient of variation (CV) will be 7.62% 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: 2014 3.75% 2015 2.55% 2016 4.50% 2017 6.30% 2018 1.95% Stock return a sample the universe Given the preceding data, the averag bn HDS's stock is the population of HDS's historical returns. Based on this conclusion, the standard deviation of HDS's The preceding data series represents historical returns is If investors expect the average realized return from 2014 to 2018 on HDS's stock to continue into the future, its coefficient of variation (CV) will be uctory 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: 2014 2015 2.55% 2016 4.50% 2017 6.30% 2018 1.95% Stock return 1.329 1.53% Given the precedind 2.31% average realized return on HDS's stock is resents of HDS's historical returns. Based on this conclusion, the standard deviation of HDS's The preceding data historical returns is If investors expect the average realized return from 2014 to 2018 on HDS's stock to continue into the future, its coefficient of variation (CV) will be Grade Il Now SaveConne Continue without saving 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: 2014 3.75% 2015 2.55% 2016 4.50% 2017 6.30% 2018 1.95% Stock return 0.52 le preceding data, the average realized return on HDS's stock is of HDS's historical returns. Based on this conclusion, the standard deviation of HDS's 0.45 Jeding data series represents 0.38 returns is 0.83 brs expect the average realized return from 2014 to 2018 on HDS's stock to continue into the future, its coefficient of variation (CV) will be