Which is the best IPO for investing in mutual funds?

I think you have got your financial terms confused. IPO is an Initial Public Offer. It is a process through which a private company goes public and gets listed on the stock exchanges. Companies can raise equity capital with the help of an IPO by issuing new shares to the public or the existing shareholders can sell their shares to the public without raising any fresh capital.

Mutual funds, on the other hand, is a medium to invest in a variety of asset classes from stocks to bonds. It’s a passive way of investing in asset classes like stocks, bonds, gold, etc. There are various categories and sub-categories of mutual funds that span across various holdings, even overlapping at times. As you can understand from the brief explanation of the terms, a mutual fund can invest in IPOs but not the other way round (with a few exceptions). 

Having said that, if you want to know the best strategy for investing in mutual funds is as follows-

Be aware of your risk appetite: This is very important as there are various MFs that have the potential to offer different rates of return. Your choice of MFs should be aligned to the amount of risk you are willing or are comfortable partaking in.

Diversification is the key: Do not put all your eggs in one basket. Any good investment will be spread across Equity, debt, liquid funds, gold, real estate, etc. The weights allotted to these categories will depend upon your risk appetite.

Goal-based investing: MFs allows for goal-based investing. For example: buying a house, children’s education, retirement corpus, etc. 

Identifying top-performing funds: One needs to analyze a fund’s performance before investing in it. A scrutiny of the past 10 years' performance of the said fund will be a good starting point.

Don’t get too involved in the market ups and downs: Review your portfolio periodically – maybe once a year. Stay invested for a long period of time. Volatility in markets is stabilized over longer periods.