2. Tactical asset allocation Jane is the chief investment officer of an Australian university endowment. The fund's strategic asset allocation is as follows: Equities Australian equities Global equities 60% 30% 30% 40% 30% 10% Fixed income Australian fixed income Global fixed income Jane has formulated the following capital market expectations for the relevant asset classes Asset class Long-term Short-term Equities A B Australian equities 10% 12% Global equities 8% 15% Fixed income D Australian fixed income 5% 3% Global fixed income 6% 4% The endowment follows top-down global tactical asset allocation program which adjust the allocation between equities and fixed income based on near-term expectations. a. Calculate the long-term and short-term return expectations for both equities (A & B) and fixed income (C&D) b. Determine and justify the changes in asset allocation weights the tactical asset allocation will lead to