NISM Certifications · NISM-Series-XXI-A: Portfolio Management Services (PMS) Distributors · Collective Investment Vehicles
Under SEBI's framework, which statement about Infrastructure Investment Trusts (InvITs) is correct?
InvITs are trusts that pool money to own infrastructure assets like roads or transmission lines and pass cash flows to unitholders. Their units are listed on exchanges, so investors exit through the market rather than redeeming at NAV from the sponsor.
- AThey are open-ended schemes redeemed daily at NAV by the sponsor
- BThey are trusts that pool money to hold infrastructure assets and distribute cash flows to unitholders, with units listed on exchangesCorrect
- CThey can invest only in government securities
- DThey are allowed only for resident retail investors with no institutional participation
Explanation
InvITs are trusts holding infrastructure projects such as roads and power transmission and distributing cash flows to unitholders. Their units are listed on stock exchanges, so investors exit by selling in the market, not by redemption at NAV. They are not limited to government securities or to retail investors.
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