Q#5. Holland & Terry, CFAs are counseling Graham Buffet, a client who is considering retirement in a few years. Graham has above average risk tolerance with risk-aversion R(A)-2. Graham has specified the downside return threshold of 4%. Three alternative strategic asset allocation are shown below: Asset Allocation Expected Return Standard Deviation 1 12% 18% B 8 15 6 10 a) Based only on risk-adjusted expected returns, which asset allocation would Graham prefer? b) According to Roy's safety first criterion, which of the three allocation is the best? c) Recommend the strategic asset allocation for Graham. Display Settings O Q#5. Holland & Terry, CFAs are counseling Graham Buffet, a client who is considering retirement in a few years. Graham has above average risk tolerance with risk-aversion R(A)-2. Graham has specified the downside return threshold of 4%. Three alternative strategic asset allocation are shown below: Asset Allocation Expected Return Standard Deviation 1 12% 18% B 8 15 6 10 a) Based only on risk-adjusted expected returns, which asset allocation would Graham prefer? b) According to Roy's safety first criterion, which of the three allocation is the best? c) Recommend the strategic asset allocation for Graham. Display Settings O