Question

The Asset Management rating primarily addresses which of the following fiduciary duties?

a. The duty of undivided loyalty to the trust customer.
b. The duty to render accountings.
c. The duty of prudence.
d. The duty to comply with agreements.

Answer 1

The Asset Management rating primarily addresses the duty of prudence, which involves managing assets with wisdom, care, and diligence, in the context of fiduciary responsibilities.

Step-by-step explanation:

The Asset Management rating is concerned with evaluating how well an asset manager performs their fiduciary duties towards the trust customers. Among the fiduciary duties listed, the duty of prudence is most directly addressed by an Asset Management rating. This duty refers to the responsibility of the fiduciary to act with wisdom, care, and diligence when managing the assets in question.

Although other duties, such as undivided loyalty, rendering accountings, and complying with agreements are also important, these are not the primary focus of Asset Management ratings. The duty of prudence can be connected with Ross's prima facie duties in that it relates to the duty to promote a maximum of aggregate good (in the fiscal sense) and the duty of non-maleficence in avoiding harm to a client's investments.