3. Measuring standalone risk using realized (historical) data A Aa E 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 Celestial Crane Cosmetics Inc. (CCC): Five years of realized returns for CCC are given in the following table. Remember: 1. While CCC 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 CCC for 2012 to 2016 are: 2012 21.25% 2013 14.45% 2014 25.50% 2015 35.70% 2016 11.05% Stock return Given the preceding data, the average realized return on CCC's stock is of CCC's historical returns. Based on this conclusion, the The preceding data series represents standard deviation of CCC's historical returns is ! If investors expect the average realized return from 2012 to 2016 on CCC's stock to continue into the future, its coefficient of variation (CV) will be