IPO bankers will not remember 2012 fondly. The market has been dismal: so far this year $119bn has been raised in 768 initial public offerings, down from $170bn in 1,225 IPOs in 2011. That has forced the bankers to crowd on to those flotations that have been available: the average number of bookrunners on global deals worth more than $500m is up from four to six. And the year’s largest and most glitzy IPO turned out to be a disaster. Facebook shares are still 30 per cent below their float price and Morgan Stanley has been fined $5m for its conduct during the IPO.

Still, consultants at Ernst & Young are undaunted. They expect a pick-up in IPO activity next year, arguing that rising share prices, low volatility in equity markets, and brighter economic prospects will spur a recovery in flotations, especially in the second half.

But that would happen only if potential buyers were to have confidence in what is on offer, and evidence from 2012 is mixed. The top 20 IPOs of the year are up by an average of 6 per cent since they floated, and within that group there are slightly more up (11) than down. But that performance is beaten by the 18 per cent improvement in the MSCI World index during the year. Even stripping out the Facebook debacle, the index has beaten the IPOs. Why invest in a risky flotation if the index will do better?