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 timats futurs results Analysts across companies use realized stock returns to estimate the risk of a stock Consider the case of Blue Llama Mining Inc. (BLM) Five years of realized retums for BLM are given in the following table. Remember 1. While BLM was started 40 years ago, its common stock has been puolely traded for the past 25 year 2. The returns on its equity are calculated as athmate returns 3. The historical returns for BLM for 2014 to 201h a 2014 2015 2018 2017 2018 Stack ratum) 10.25% 11.05% 10.50 27.30% 64% Given the preceding data, the average realized return on BLM's stook is The preceding data series represents histanical retums is Mancal retums Based on this concin, the mandard den of If investors expect the average realized return from 2014 2018 on BOY's kane into the future of B 1. While LM 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 retums for BLM for 2014 to 2018 are 2014 2015 2016 2017 2018 11.05% 19.50% 27.30% 8.45% Stock retum 15.25% Given the preceding data, the average realized return on BLM's stock is The preceding data series represents historical returns is of BLM's historical retums. Based on this conclusion, the standard deviation of BLM It investors expect the average realized retum from 2014 to 2018 on BLM's stock to continue into the future, its coefficient of variation (CV) will be