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Brewin Dolphin tipped for post-Budget bounce

The portfolio manager of Fidelity’s £2.89bn flagship fund is tipping the listed wealth management firm as a result of ‘positive’ Budget changes, set to give pensioners far more flexibility over drawdown than currently possible.

Mr Wright, who also manages the £512.25m Fidelity Special Values investment trust, said the company can also capitalise on more consolidation in the IFA sector, a gradual exodus of advisers post-RDR and regulation which has “pushed up fixed costs for the industry”, giving a “further advantage to larger wealth managers”.

He said: “Brewin Dolphin also benefits from internal change as a new management team focus on cutting costs and raising margins closer to those of peers.”

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With a market capitalisation is £924.47m as of Tuesday, the firm’s share price rose 9p from 330p on Wednesday, before falling back down to 336p at close of trading yesterday.

The share price has been climbing steadily from 197p this time last year, though the current share price remains below its previous peak of 354p on 6 March.

David Nicol, the firm’s chief executive, was highly upbeat about the implications of the Budget on Wednesday, saying it would be “hugely welcomed” by the industry and the firm’s clients. He added that he would be working with the Treasury to see how the chancellor’s proposed ‘right to advice’ package would be delivered.

He added: “The doubling of capital allowances to £500,000 is most welcome to Brewin Dolphin, at a time when we are expanding our business and our office base.”

Hargreaves Lansdown, the Bristol-based fund supermarket, was one of the biggest intial winners from the Budget, gaining £860m in value in just two hours, on a day when seven annuity providers saw £3.2bn wiped off their combined value.