David, a 60-year-old nearing retirement, is looking for an investment strategy that prioritizes capital preservation and generates a steady income stream. He has a low-risk tolerance and wants to avoid significant market volatility. Which portfolio model would best align with his objectives?

Question: David, a 60-year-old nearing retirement, is looking for an investment strategy that prioritizes capital preservation and generates a steady income stream. He has a low-risk tolerance and wants to avoid significant market volatility. Which portfolio model would best align with his objectives?

Answer options:

• Growth Portfolio ✅ Conservative Portfolio
• Aggressive Growth Portfolio
• Balanced Growth Portfolio

Correct answer: Conservative Portfolio

Explanation: For an investor nearing retirement with a low-risk tolerance, a conservative portfolio is most suitable. This model emphasizes capital preservation and income generation, typically achieved with a higher allocation to fixed income and cash equivalents.