Objectives	Risk Tolerance		Ability to take risk: Martin is a pediatrician and has a high level of income. The high level of income, and modest size of living expenses compared to overall assets give the Torch's a high ability to tolerate risk. Willingness to take risk: Torch states that he wants to emphasize protecting the asset base he has built and does not want the value of his investments to decline more than 10% in a given year. Torch's statement implies a low willingness to take risk. Overall: The low willingness to take risk overshadows the Torch's high ability to take risk.
	Return Objectives		Income requirement in retirement is 2.1%. Growth requirement including inflation and meeting gifting goals is 3.8%. Total after tax return requirement = 5.9%.
Constraints		Time Horizon	Multistage, consisting of 3 time horizons 1. Torch will retire in 5 years. 2. Retirement - at least 20 years. 3. Post retirement - desire to gift assets at death to children and charities.
		Liquidity Requirements	Minimal liquidity requirements other than funding annual living expenses.
		Legal/Regulatory	Seek legal counsel to create documents to express the Torch's wishes after their death.
		Taxes	The Torch's are taxable investors in the 35% tax bracket. Tax aspects of investments should be considered.
		Unique Considerations	Desire to leave two children and charities a large estate after the death of Martin and Sheila.

Asset Class	Expected After-tax Return	Expected Yield	Allocation 1	Allocation 2	Allocation 3
Cash (T-bills)	3.0%	3.0%	5%	5%	10%
Domestic Bonds	5.5%	5.5%	15%	20%	35%
International Bonds	6.5%	5.0%	5%	10%	10%
Domestic Equities	8.0%	2.0%	40%	40%	30%
International Equities (Developed)	11.0%	2.5%	10%	20%	10%
Venture Capital	20.0%	0.0%	20%	0%	0%
Real Estate (REITs)	8.0%	5.0%	5%	5%	5%
Expected after-tax return			10.00%	7.70%	6.78%
Expected yield			2.53%	3.30%	3.83%
Sharpe ratio			0.42	0.52	0.62