Asset Allocation Strategy for a Private Foundation

As an investment manager for a private foundation, you are tasked with developing a long-term investment strategy that aligns with the foundation's mission and spending policy. The foundation has a total endowment of $50 million, and it typically makes distributions of 5% of the endowment's market value annually to support its charitable activities. The foundation is focused on capital preservation while also seeking moderate growth.

Discuss the key considerations you should take into account when creating an asset allocation strategy for the foundation. Include analyses of risk tolerance, time horizon, liquidity requirements, and any unique factors that may influence the investment strategy.