As a recently qualified financial advisor, you are helping a client who is a bright scholarship student who just graduated from university invest her $1,000,000$ inheritance from an estranged relative. You plan to divide the client$$s capital into $2$ parts or tranches.

The first part or tranche consists only of government bonds, the second part or tranche only individual stocks.

Before committing the fund, you decide to backtest $($i$.$e$.$ see how the portfolio would have performed in a previous time period$)$ and present the portfolio report to the client.

Required:

$1.$ Decide what percentage of the portfolio you will allocate to bonds and what percentage to stocks. Explain clearly why you made these choices given the clients specific characteristics based on the information provided about her. State any assumptions you make clearly.