New Mexico § 46-3A-414 Derivatives and options

New Mexico Statutes

§ 46-3A-414 — Derivatives and options

New Mexico § 46-3A-414

Ch. 46Fiduciaries and Trusts

Art. 4ALLOCATION OF RECEIPTS

This text of New Mexico § 46-3A-414 (Derivatives and options) is published on Counsel Stack Legal Research, covering New Mexico primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

N.M. Stat. Ann. § 46-3A-414 (2026).

Text

(a)As used in this section, "derivative" means a contract or financial instrument or a combination of contracts and financial instruments which gives a trust the right or obligation to participate in some or all changes in the price of a tangible or intangible asset or group of assets, or changes in a rate, an index of prices or rates, or other market indicator for an asset or a group of assets.

(b)To the extent that a trustee does not account under Section 403 [46-3A-403 NMSA 1978] for transactions in derivatives, the trustee shall allocate to principal receipts from and disbursements made in connection with those transactions.

(c)If a trustee grants an option to buy property from the trust, whether or not the trust owns the property when the option is granted, grants an option that pe

Free access — add to your briefcase to read the full text and ask questions with AI

(a) As used in this section, "derivative" means a contract or financial instrument or a combination of contracts and financial instruments which gives a trust the right or obligation to participate in some or all changes in the price of a tangible or intangible asset or group of assets, or changes in a rate, an index of prices or rates, or other market indicator for an asset or a group of assets. (b) To the extent that a trustee does not account under Section 403 [46-3A-403 NMSA 1978] for transactions in derivatives, the trustee shall allocate to principal receipts from and disbursements made in connection with those transactions. (c) If a trustee grants an option to buy property from the trust, whether or not the trust owns the property when the option is granted, grants an option that permits another person to sell property to the trust or acquires an option to buy property for the trust or an option to sell an asset owned by the trust, and the trustee or other owner of the asset is required to deliver the asset if the option is exercised, an amount received for granting the option must be allocated to principal. An amount paid to acquire the option must be paid from principal. A gain or loss realized upon the exercise of an option, including an option granted to a settlor of the trust for services rendered, must be allocated to principal.