Asset Allocator spent much of yesterday’s Budget contemplating which of Reeves’ measures are most relevant to DFMs. 

Of course capital gains tax has some impact - but only if an investor's portfolio is not in a tax-sheltered environment and in any event these are matters for the adviser. The ultimate answer to our question may lie with the Aim market – the exchange where British companies sink or swim, while investors benefit from inheritance tax exemption on share ownership.

Like many Budget rumours which didn’t come to pass, many industry figures were concerned Labour would do away with this exemption entirely. Instead, relief was capped at 50 per cent, sending the FTSE Aim 100 index up more than 4 per cent on Wednesday. 

What this means in practice is any portfolio above £1mn is liable for IHT, but at 20 per cent rather than 40 per cent.

Despite a rise in employers’ national insurance contributions that may penalise smaller companies through higher staff costs, the news has been generally well-received by Aim companies. 

What does this mean for allocators, then? 

Use of Aim stocks in portfolios is relatively scarce given their inherent size and associated volatility, but there are a couple of funds which do offer this exposure.

Gresham House UK Micro Cap is held by just one allocator in our database, but 70 per cent of its holdings are Aim-listed. 

Ditto for the popularity of Liontrust UK Micro Cap, but this time it has a near-90 per cent weighting to these relative minnows. 

Anthony Cross, manager of the Liontrust fund, was particularly pleased with the chancellor’s clarification on IHT relief. 

"With interest rates reducing, growth returning, a stable government and this question now resolved, we believe the headwinds that have been plaguing AIM have now turned into tailwinds,” he said.

As we have discussed before, allocators tend not to put a lot of money on the smallest of the small UK companies, and yesterday's announcements are probably unlikely to change that.

RC Brown, a Bristol-based DFM which offers Aim-centric portfolios for tax-mindful clients, also welcomed the news. 

"As it is, the 50 per cent business relief is a useful incentive for investors to continue investing in Aim IHT portfolios and their pool of capital remains important to the funding of younger growth companies, the types of company attracted to the Aim market," said Oliver Brown, investment director at RC Brown.

However, he added that they'd like to see Aim shares qualifying for the £1mn business relief that other unlisted companies enjoy.