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Finance Glossary

Just call us Bond. Amortized bond.

Over 700 finance terms, Shmooped to perfection.

Prudent Investor Rule


An outgrowth of the "prudent man rule." Under this standard, fiduciaries are now permitted to invest funds in the same manner that a "prudent investor" would invest. As a practical matter, this now requires investing in a diversified portfolio, which means that stocks as well as bonds can be considered suitable investments.