- (a) Prudent person standard. Investments shall be made with judgment and care, under circumstances then prevailing, which a person of prudence, discretion, and intelligence would exercise in the management of the person's own affairs, not for speculation, but for investment, considering the probable safety of capital and the probable income to be derived.
(b) Considerations. In determining whether the investment officer has exercised prudence with respect to an investment decision, the following shall be considered:
- (1) the investment of all funds under the board's control, over which the officer had responsibility rather than a consideration as to the prudence of a single investment;
- (2) whether the investment decision was consistent with this chapter and state law; and
- (3) whether deviations from expectation are reported in a timely fashion and appropriate action is taken to control any adverse developments.
Source Note:The provisions of this §365.6 adopted to be effective June 6, 1996, 21 TexReg 4816.