CTFA Practice Questions - Certified Trust And Fiduciary Advisor (CTFA) Exam

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A trustee is reviewing a portfolio that holds equities, bonds, and cash. Under the prudent investor rule, how should prudence usually be evaluated?

By comparing each holding to the trustee's personal account By judging each security only on its most recent quarterly return By looking at the portfolio as a whole in light of the trust's purposes, terms, and risk-return objectives By requiring every asset class to produce the same income yield

Correct Answer:

By looking at the portfolio as a whole in light of the trust's purposes, terms, and risk-return objectives

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