The Uniform Prudent Investor Act (UPIA), which was adopted in 1992 by the American Law Institute's Third Restatement of the Law of Trusts ("Restatement of Trust 3d"), reflects a "modern portfolio theory" and "total return" approach to the exercise of fiduciary investment discretion.
This approach allows fiduciaries to utilize modern portfolio theory to guide investment decisions and requires risk versus return analysis.
(However, guardianship and conservatorship accounts generally remain limited by specific state law.)
In those states which adopted part or all of the Uniform Prudent Investor Act, investments must be chosen based on their suitability for each account's beneficiaries or, as appropriate, the customer.
Although specific criteria for determining "suitability" do not exist, it is generally acknowledged, that the following items should be considered as they pertain to account beneficiaries: