The investment focus in Danish markets is often on the bond side because yields on Danish krone bonds have been so attractive. The fund performance tables show this quite clearly. And looking at the portfolio weightings of European bond fund managers, Denmark is often a significant component. For pure Danish bond exposure, the Frontrunner Danish bond Sicav from Unibank invests in a range of top class issues.

The majority of European equity fund managers have shown a reluctance to invest in the Scandinavian markets of late, a reflection of the high proportion of cyclical stocks in these markets. One exception is the Fleming Frontier European Discovery Fund which has over 9% of its $130m in Danish stocks. The fund has a small cap focus and fund manager Peter Testa's approach is entirely growth stock driven. He aims to take advantage of inefficient valuations in this poorly re-searched section of the market.

According to fund analysis firm Forsyth Partners, Flemings' style favours a buy and hold strategy with portfolio turnover in the region of 45% per annum.

Forsyth also highlights Fidelity's Nordic Fund, part of the group's Luxembourg Sicav, which it gives a top rating of AAA. Although the fund has half its Kr3460m assets in Swedish stocks, it has 11% in Denmark and fund manager Colin Stone is confident of returns from Danish stocks on a two to three year view.

Approximately 25% of the fund is invested in medium sized companies, defined as those between $500m and $5bn. A further 20% will be invested in companies with market cap of less than $500m.

From a possible list of 250 Scandinavian companies, based on regular contact and visits, the fund will be invested in growth stocks, accounting for maybe 70% of the total portfolio, with the balance invested in recovery and value stocks.