Structured Products in Trust Portfolios?Structured Products in Trust Portfolios?

Many fiduciaries have greatly expanded the types of investments they use in portfolios, thanks to the freedom afforded by widespread adoption during the past two decades of both the Uniform Prudent Investor Act and the Uniform Principal and Income Act. Whereas portfolios typically were invested almost exclusively in stocks and bonds previously, today’s portfolios frequently add commodities, foreign currencies and a variety of other investments to the mix. (See “Today’s Trust Portfolios (a Sample),” this page.)

Among a fiduciary’s current prudent investment choices, structured products can serve an important purpose. In the right circumstances and handled properly, these strategies—also known as structured investments, structured notes ...