Under the PIR no particular investment is either prudent or imprudent. The decision is made based upon return vs. risk, where risk is measured by the asset’s impact on the portfolio. Always get confuse with PIR and PMR. Any experts take on these types of questions? thanks
I think that the prudent investor rule refers more on the concept that no particular investment is risky or non risky, the important thing is its participation within the portfolio. In another way the important thing about PIR is that it measures risk and return in a portfolio setting
The PMR is really old (think before all this markowitz and other portofolio theory was accepted). Because of this, as a fiduciary, you could only invest a certain way with very un-risky assets. This was because each assets was viewed on its own merits, not within the context of the portfolio as a whole (which portfolio theory tells us). In fact in the really old days there were just lists of securities you could choose from is some states (legal lists). If in doubt remember than the PIR incorporates all the fudamentals of modern portfolio theory.