New Delhi, May 30 -- Sixty-year-old Ram was looking for some good investment options when he came across Power Grid Infrastructure Investment Trust (InvIT). Trading at Rs.86 and having a 14% yield, it appeared to be an attractive option for locking in a high income during his retirement years.

After all, fixed deposits yield 6-7% interest every year, and investment-grade bonds could only reach up to 10%.

Tempted by the high return, Ram decided to consult his financial advisor before making a move.

"That's not how it works," his advisor said.

Understanding InvITs

For starters, Infrastructure Investment Trusts or InvITs are instruments that allow investors to earn from the cash flow generated from various infrastructure assets, includi...