There’s a paradox at the heart of the recent wave of IPOs: retailers are welcomed to the market, followed by a fall in share price.

There’s a paradox at the heart of the recent wave of IPOs.

On one hand, retailers have been welcomed to market with open arms and some have achieved jaw-dropping valuations.

On the other, barely a single one has managed to sustain never mind increase its share price since listing. Sell-offs have frequently been little short of instantaneous.

So what’s going on? It’s a combination of things, N+1 Singer’s Matthew McEachran believes.

Chunky valuations make some of the less convincing new market arrivals vulnerable to shorting, while there has also been some forced selling reflecting changes in the market more widely.

The upshot of this, and better valuations elsewhere, is that retailers still hoping to come to market are likely to face increased demands for discounts from the institutions they’re courting.