Well since they both want to employ a rebalancing strategy Buy and Hold is out of the question. Then, given her willingness to take on risk increasing given her increased wealth from her inheritance the only possible choice is CPPI, as a constant mix would assume a constant relative risk tolerance.
I had the same issue. The question clearly states that minimizing cost is important to her and BH is the only one providing that. But CPK has a great point about the no trading aspect…
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