High Net Worth Scenario

Brian Taylor is a 60-year-old entrepreneur who sold his business 5 years ago after 35 years. He would like to utilize his expertise to start another business in his former industry.

Katie Taylor is 52 and a passionate equestrian.

Both are U.S. citizens and Arizona residents.

The Taylors have no children.

They own homes in both Arizona and California and have no plans to sell.

Brian and Katie's legacy plan is to create an equestrian rescue ranch on their current Arizona ranch.

They have assets of $100 million.

$46 million is held in their living trust investment account, the majority of which is invested in a portfolio of municipal and corporate bond funds with a high-yield exposure to each of 10%.

$1 million is in Brian's IRA invested in a taxable bond fund.

Homes and personal property they plan on keeping throughout their lives are valued at $39 million (not including the Arizona ranch)

Other properties and land that could be divested are valued at $10 million.

The Taylor's Arizona ranch is valued at $4 million.

Total liabilities are $5milion. A fixed-rate securities-based loan on their investments is scheduled to adjust to a floating rate in 9 months.

The Taylors current budgetary needs are approximately $175,000 per month.

The purpose of this assignment is to develop an investment policy statement, including a recommended portfolio, for a potential client.

An overview of the client; A detailed explanation of the investment policy statement, including the investment and objectives for the portfolio based on the unique needs and preferences of the client; A description of any investment constraints, liquidity needs, and the client's time horizon be sure to incorporate knowledge from the course that may include the discussion of: expected standard deviation, risk/reward, downside deviation, present/future value of investment, etc. Data presented in the form of numbers, graphs, and charts -- utilize the Monte Carlo illustration of outflows; A justification of each investment recommendation you will make to the client; Justification for your policy recommendations based on the principles of modern portfolio theory; Core allocation percentage targets and ranges; Tactical allocation percentage ranges