{
    "type": "ETF",
    "ucits": true,
    "fund_name": "VanEck Morningstar US SMID Moat UCITS ETF",
    "investment_objective": "Track the Morningstar US Small-Mid Cap Moat Focus Index",
    "primary_asset_class": "Equity",
    "geographic_focus": "United States (98.74%) with minor exposure to UK and Bermuda",
    "replication_method": "physical",
    "swaps": true,
    "derivatives": false,
    "leverage": false,
    "inverse": false,
    "complex_factors": "Swaps usage, Optimised sampling, Derivative instruments for tracking",
    "classification": "complex",
    "supporting_data": "The Fund primarily invests physically in the underlying equity securities of the Morningstar US Small-Mid Cap Moat Focus Index, which is a small- and mid-cap equity index focused on US companies with durable competitive advantages. However, the KIID and PRIIPs documents explicitly state that the Fund may also invest in financial derivative instruments (FDIs) including futures, options, and swaps (including equity swaps and index swaps). The presence of swaps, even if used for tracking and not for leverage, triggers complexity under MiFID II rules. The replication method is physical but supplemented by optimised sampling and derivatives to improve tracking efficiency. There is no leverage or inverse exposure. The risk profile is high (7/7 in KIID, 5/7 in PRIIPs), reflecting the volatility of small- and mid-cap equities rather than structural complexity. The Fund is UCITS compliant. The monthly factsheet confirms physical full replication with semi-annual rebalancing and no mention of synthetic replication or funded/unfunded swap structures. The derivatives appear to be used for efficient index tracking rather than inherent leverage or capital protection. Despite this, the use of swaps and other derivatives for tracking, combined with optimised sampling, means the product is classified as complex under MiFID II. There is no capital protection or structured product features. Costs are straightforward with a TER of 0.49% and no performance fees. No leverage or inverse terms are present. The PRIIPs KID does not carry a specific comprehension warning but does highlight the need for investor understanding of the product and market risks. Overall, the complexity arises mainly from the use of swaps and derivatives in the replication strategy, which is sufficient under MiFID II to classify the ETF as complex, even though the underlying assets are straightforward equities and the fund is UCITS compliant."
}