prudent man rule - définition. Qu'est-ce que prudent man rule
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Qu'est-ce (qui) est prudent man rule - définition

The prudent man rule; Prudent person rule; Prudent man; Prudent Man

prudent man rule         
n. the requirement that a trustee, investment manager of pension funds, treasurer of a city or county, or any fiduciary (a trusted agent) must only invest funds entrusted to him/her as would a person of prudence, i.e. with discretion, care and intelligence. Thus solid "blue chip" securities, secured loans, federally guaranteed mortgages, treasury certificates and other conservative investments providing a reasonable return are within the prudent man rule. Some states have statutes which list the types of investments allowable under the rule. Unfortunately, the rule is subjective, and some financial managers have put funds into speculative investments to achieve higher rates of return, which has resulted in bankruptcy and disaster, as in the case of Orange County, California (1994). See also: fiduciary trustee
Prudent man rule         
The prudent man rule is based on common law stemming from the 1830 Massachusetts court formulation, Harvard College v. Amory9 Pick.
Émile Prudent         
  • Montmartre Cemetery
PIANIST AND COMPOSER
Emile Prudent
Émile Racine Gauthier Prudent (3 February 181714 May 1863) was a French pianist and composer. His works number about seventy, and include a piano trio, a concerto-symphony, many character pieces, sets of variations, transcriptions and etudes, in addition to his celebrated fantasies on operatic airs.

Wikipédia

Prudent man rule

The prudent man rule is based on common law stemming from the 1830 Massachusetts court formulation, Harvard College v. Amory The prudent man rule, written by Massachusetts Justice Samuel Putnam (1768-1853), directs trustees "to observe how men of prudence, discretion and intelligence manage their own affairs, not in regard to speculation, but in regard to the permanent disposition of their funds, considering the probable income, as well as the probable safety of the capital to be invested."

Under the prudent man rule, when the governing trust instrument is silent concerning the types of investments permitted, the fiduciary is required to invest trust assets as a "prudent man" would invest his own property with the following factors in mind:

  • the needs of beneficiaries;
  • the need to preserve the estate (or corpus of the trust); and
  • the amount and regularity of income.

The application of these general principles depends on the type of account administered. The prudent man rule continues to be the prevailing statute in a small number of states, in particular with regards to investments permitted by mutually-chartered institutions such as savings banks and insurance companies.