Pete is 65 years old, married, and has three adult children. He is currently employed in the energy industry and earns roughly $1 million annually. He anticipates retiring completely from this position next year and relying solely on his portfolio to maintain his and his wifes combined spending level of $400K annually. In addition to these portfolio assets, they also own a $2 million home in The Woodlands. Pete and his wife have no other financial assets or business interests. Beyond the value held in this portfolio, the only income they will receive is Social Security, which is not particularly impactful given their level of assets and spending.Pete is more risk averse than the average client. His approach to investing generally places wealth preservation as the top priority, followed by keeping up with inflation, and capital appreciation after that. The volatility in financial markets during the onset of the Covid crisis was unsettling to Pete despite his ability to weather the storm.

Taxable Investment Account Allocation Use this to respond to the Taxable Investment Account Allocation questions on the next slide. Taxable Investment Accounts Charles Schwab: $7,101,300 Charles Schwab: 410,400 Total: $7,511,700 Refer to the table below for performance information to answer the following questions. The benchmark is a custom asset weight-based benchmark (allocations across assets of the portfolio target those in the benchmark.) Has Pete's portfolio outperformed its benchmark in nominal terms over the last three and five years? Has Pete's portfolio outperformed or underperformed its benchmark on a risk-adjusted basis over the last five years? How are you able to draw this conclusion? Taxable Investment Account Allocation Use this to respond to the Taxable Investment Account Allocation questions on the next slide. Taxable Investment Accounts Charles Schwab: $7,101,300 Charles Schwab: 410,400 Total: $7,511,700 Refer to the table below for performance information to answer the following questions. The benchmark is a custom asset weight-based benchmark (allocations across assets of the portfolio target those in the benchmark.) Has Pete's portfolio outperformed its benchmark in nominal terms over the last three and five years? Has Pete's portfolio outperformed or underperformed its benchmark on a risk-adjusted basis over the last five years? How are you able to draw this conclusion