Prudent Investor Rule

C

Modern Portfolio Theory dictates that trustees consider a portfolio in its entirety and not just on an investment-by-investment basis. As a fiduciary, therefore, the trustee must: - adhere to fundamental fiduciary duties of loyalty, impartiality and prudence. - maintain overall portfolio risk at a reasonable level - the trade-off between risk and return is the fiduciary's central concern. - provide for reasonable diversification of trust investments. - act with prudence in deciding whether and how to delegate authority to experts and in selecting and supervising agents. - be cost conscious when investing.