The remarkable rise of Novo Nordisk over 2023 briefly saw the drugmaker become Europe’s most valuable company by market cap, overtaking LVMH, on the strength of its groundbreaking anti-obesity drug Wegovy.

Many analysts have predicted this could happen on a more permanent basis in 2024 as Bernard Arnault, managing director of LVMH, may encounter more difficulty selling expensive handbags to China, where a significant proportion of the luxury goods market is based. 

With Novo Nordisk ruffling feathers, we thought it worthwhile to examine DFMs’ exposure to the stock within the European funds that we cover. 

Several of most popular European equity funds in our database have become, if you’ll excuse the pun, overweight to Denmark as a result of the drugmaker’s rally. 

The largest weighting among our DFMs’ portfolios is found in Giles Rothbarth’s BlackRock European Dynamic, which has 18 per cent exposure to Denmark, and 9 per cent to Novo Nordisk alone. 

By way of comparison the MSCI Europe ex-UK index has an exposure of just 6.6 per cent to Denmark, with an average weighting to Novo Nordisk of 4.1 per cent.

The £3.9bn BlackRock product is the most popular European equity fund in our database, held by 11 allocators in total. 

Our allocators are more prone to choosing funds that favour the pharmaceutical sector: Asset Allocator’s number-crunching shows that the top five most popular active European funds in our database hold an average exposure to Denmark of 8.6 per cent and an average exposure to Novo Nordisk of 5.3 per cent.

Of these five, only Premier Miton European Opportunities opts for an insignificant stake in the drugmaker, while the rest remain very keen. 

Going forward, DFMs may have to choose between trimming their holdings or their waistlines. We’ll leave it up to them to decide which.