Part I of this note will begin with a background of trust and trustees, focusing on the historical development of the trust and the present role of the trustee. Part II presents the Prudent Investor Rule. The problems in trust management which lead to the necessity of the Rule will be explored, as will the evolution of the Rule up to the recent adoption by the American Law Institute of the Third Restatement of Trusts, which is devoted solely to the Prudent Investor Rule. In Part III, the various investment opportunities available to the modern investor will be presented, first generally, then focusing on international investment vehicles. Part IV is devoted to an explanation of modern portfolio theory, the basis of all modern thinking about investment and the impetus to the revision of the Second Restatement of Trusts. In Part V, the various ideas already presented will be brought together to prove the duty of the modern trustee to consider international investment opportunities when managing the wealth of the trust. The note will conclude with a review of the argument and some closing thoughts.
Stephen M. Penner,
International Investment and the Prudent Investor Rule: The Trustee's Duty to Consider International Investment Vehicles,
Mich. J. Int'l L.
Available at: https://repository.law.umich.edu/mjil/vol16/iss2/9