Strategic Asset Allocation for a Moderate Risk Client

A portfolio manager is tasked with developing a strategic asset allocation strategy for a client who is 30 years old, with a moderate risk tolerance, and aims to retire at 65. The client has a current investment portfolio of $100,000 and expects to contribute $10,000 annually. Considering the long-term investment horizon and the client's risk profile, the manager decides to allocate a portion of the portfolio to equities, fixed income, and alternative investments.

The manager believes that over the long run, equities should provide higher returns compared to fixed income and alternatives. Therefore, to develop the strategic asset allocation, the manager is considering three potential allocations:

- Option A: 60% Equities, 30% Fixed Income, 10% Alternatives

- Option B: 50% Equities, 40% Fixed Income, 10% Alternatives

- Option C: 70% Equities, 20% Fixed Income, 10% Alternatives

Which of the following allocations is most appropriate for the client's stated objectives and risk profile?