bodhisattva

On, so unsmoothed is actual market, I get that, and I get that smoothing lowers volatility, makes sense,


But what is the difference in Question 26-31 reading p 123, where one is called unsmoothed and one is called uncorrected - your statement in your last post equates unsmoothed and uncorrected (saying they are synonyms), but the exact statement below on page 123 implies that "without correction" means smoothed and that "unsmoothed" will be the one with the wilder volatility:

"He recommends the NCREIF (unsmoothed) because the NCREIF (without correction) historically suffers from a bias"

Then paraphrasing, the answer to the question (27) "What is that bias" is "understated volatility"



Whats the deal?