# Calculate Idiosyncratic Risk?

I have basic finance background but I am trying to calculate idiosyncratic risk as measure for firm risk in my CEO gender research.

I have found the following on Alpha architect but I am unsure of how to interpret this and actually calculate the residuals.

I am not using Excel, but Stata. For this reason I really need to understand what I am doing so that I can code it in Stata. Importantly, I am trying to calculate Idiosyncratic Risk defined as follows: "the annualized standard deviation of the residuals from the regression of daily returns over the firm's fiscal year".

I have some of the inputs already. I have the excess returns of the firm stocks in my dataset, the market excess returns and I have calculated the beta's for my firms. I also have the FF 3 factors.

The Alpha Architect link contains an Excel example of which I am basing my questions.

Here is a visualization from the Excel.

Some of the links in the explanation I have don't work so I am unsure how exactly I need to do the following: 1. what I need the beta for? 2. how to conduct the Fama French 3 Factor regression so that I can extract the residuals of that regression 3. how to calculate Idiosyncratic risk once I have the residuals

1) the market risk, and

Thus, the model is that any firm has a systematic risk which is $\beta$ times the move of the market. When you subtract that out (on a daily basis) what is left is the unique, idiosyncratic risk of the firm after adjusting for the market and the beta of the firm.