Do No Harm:4 Attempts: 2. Measuring standalone risk using realized data Returns eamed over a given time period are called realized returns. Historical data on realized returns is often used Aa Aa to estimate future results. Analysts across companies use realized stock returns to estimate the risk of a stock Consider the case of Falcon Freight Inc. (FF): Five years of realized returns for FF are given in the following table. Remember: 1. While FF 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 arithme c returns 3. The historical returns for FF for 2012 to 2015 are: 2012 2013 2014 2015 2016 Stock return 23.75% 16.15% 28.50% 39.90% 12.35% Given the preceding data, the average realized return on FF's stock is 24.13% , The preceding data series represents standard deviation of FF's hstorical returns is of FF's historical returns. Based on this condusion, the 9.70% If investors expect the average realized return from 2012 to 2016 on FF's stuk coefficient of variation (CV) will be continue into the future, its 3 3.341 2004-2016 Apla Aights eserved Grade It Now Continue without saving