§ 18-15-2 - Standard of care – Portfolio strategy – Risk and return objectives.
SECTION 18-15-2
§ 18-15-2 Standard of care –Portfolio strategy – Risk and return objectives. – (a) A trustee shall invest and manage trust assets as a prudent investor would,by considering the purposes, terms, distribution requirements, and othercircumstances of the trust. In satisfying this standard, the trustee shallexercise reasonable care, skill, and caution.
(b) A trustee's investment and management decisionsrespecting individual assets must be evaluated not in isolation but in thecontext of the trust portfolio as a whole and as part of an overall investmentstrategy having risk and return objectives reasonably suited to the trust.
(c) Among circumstances that a trustee shall consider ininvesting and managing trust assets are any of the following that are relevantto the trust or its beneficiaries:
(1) General economic conditions;
(2) The possible effect of inflation or deflation;
(3) The expected tax consequences of investment decisions orstrategies;
(4) The role that each investment or course of action playswithin the overall trust portfolio, which may include financial assets,interests in closely held enterprises, tangible and intangible personalproperty, and real property;
(5) The expected total return from income and theappreciation of capital;
(6) Other resources of the beneficiaries;
(7) Needs for liquidity, regularity of income, andpreservation or appreciation of capital; and
(8) An asset's special relationship or special value, if any,to the purposes of the trust or to one or more of the beneficiaries.
(d) A trustee shall make a reasonable effort to verify factsrelevant to the investment and management of trust assets.
(e) A trustee may invest in any kind of property or type ofinvestment consistent with the standards of this chapter.
(f) A trustee who has special skills or expertise, or isnamed trustee in reliance upon the trustee's representation that the trusteehas special skills or expertise, has a duty to use those special skills orexpertise.