Awful SPAC Returns Mean More Frustration for Blank-Check Firms

The SPAC market offered investors only disappointment last quarter, but it may seem like the good old days as regulators crack down on new blank-check stocks and enthusiasm for existing ones wanes.

The IPOX SPAC Index fell 9.5%, the worst performance since its July 2020 launch, and has lost more than 22% over the past three quarters. There are 610 special-purpose acquisition companies hunting for deals or racing the clock to find one, and some existing transactions are falling apart. SPAC warrants, which hold the promise of future windfalls, are trading at a fraction of year-earlier levels.

Heavyweight sponsors ...