From this paper (https://www.aqr.com/Insights/Research/Alternative-Thinking/Was-That-Intentional-Ways-to-Improve-Your-Active-Risk) I would like to know how to solve for the amount of active risk (i.e. the 1.7% with an IR of 0.25 and a loss of 1% in 1 out of 5 years) based on the loss frequency and information ratio.

How do I compute this - rather simple - in Excel?

Thank you.

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