NISM Certifications · NISM-Series-XXI-A: Portfolio Management Services (PMS) Distributors · Collective Investment Vehicles
Which of the following is a key characteristic of an Infrastructure Investment Trust (InvIT)?
An InvIT pools money from investors to own infrastructure assets such as roads or transmission lines and distributes the cash flows generated to unit holders. Its units are listed on exchanges and returns are not guaranteed.
- AIt pools money from investors to hold infrastructure assets and distributes cash flows to unit holdersCorrect
- BIt invests only in equity shares of listed banks
- CIt guarantees a fixed return on units
- DIt cannot be listed on any stock exchange
Explanation
InvITs pool funds to own infrastructure projects such as roads or power transmission and pass on most cash flows to unit holders. Returns are not guaranteed. InvIT units are listed on stock exchanges.
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