KILO MIDEM is a widow. Her husband, a doctor, worked for a global pharmaceutical company and oversaw many productivity-enhancing improvements. He invested significantly in XYZ Company shares when it was a private company; these highly-appreciated shares constitute about half of Emilys $10 million portfolios now.

KILO has 3 children (two of which are married) and six grandchildren, so far. Emily has said that she would like to provide for her grandchildrens education. Upon her death, the portfolio will pass to her three children in equal shares.

KILO has few significant expenses aside from normal living expenses. She volunteers at a local soup kitchen, makes occasional gifts to her children and grandchildren, and spends a great deal of time painting.

The POSTAR Portfolio is currently allocated as follows:

5,000,000 ABC Company Stock (3% dividend, highly appreciated)

2,000,000 Tax-Exempt Bonds (3% yield)

2,900,000 Diversified Equities (moderately appreciated)

100,000 Money Market Funds

KILO understands that you cant get something for nothing, but doesnt really know how markets work. Shes open to learning, however.

Develop an Investment Policy Statement that addresses the portfolios risk profile, return requirement, time horizon, liquidity issues, tax consideration, legal/regulatory framework, and unique circumstances. Generate an asset allocation using the asset class outline that fulfills these requirements.