Invest In IPOs Directly Or Through Mutual Funds? Expert Reveals The Best Strategy

Many retail investors face a dilemma: they do not apply to IPOs directly, yet their mutual funds participate, and poor listing performance drags their portfolio. Market experts advise that investing through mutual funds or PMS managers offers a safer and more structured approach than jumping into IPOs individually. Professional fund managers take calculated risks, backed by research teams, valuation frameworks, and planned anchor exit strategies—unlike retail investors who often enter blindly and face steep losses. Mutual funds decide when to apply, when to exit, and which stocks to hold post-listing, reducing emotional decision-making. The expert compares direct participation without knowledge to swimming in the ocean without knowing how to swim—a high-risk move that investors should avoid.