{
    "type": "ETF",
    "ucits": true,
    "fund_name": "HSBC MSCI EUROPE UCITS ETF",
    "replication_method": "physical",
    "leverage": false,
    "derivatives": false,
    "swaps": true,
    "inverse": false,
    "complex_factors": "Swaps usage for partial exposure, securities lending, potential tracking error",
    "classification": "complex",
    "supporting_data": "The Fund aims to track the MSCI Europe Index primarily through physical replication of underlying equities. However, it may invest up to 10% of its assets in total return swaps and contracts for difference, and up to 10% in other funds, including HSBC funds. The use of total return swaps and contracts for difference, even if limited, introduces synthetic elements and counterparty risk, which are complexity indicators under MiFID II. The Fund also engages in securities lending up to 30% of assets, which adds operational and counterparty risk. The risk and reward profile is high (category 6 in KIID), reflecting amplified risk from derivative usage and market volatility. The PRIIPs KID rates the product at risk level 4 out of 7, indicating medium risk but notes investment leverage risk and counterparty risk. The monthly factsheet confirms physical full replication as the primary method but acknowledges derivative usage for partial exposure and risk management. There is no leverage or inverse exposure. The Fund is UCITS compliant. The presence of swaps, even if limited to 10%, mandates classification as complex under MiFID II rules. No capital protection or structured features are present. Costs are straightforward with no performance fees, but derivative-related costs exist. Overall, the synthetic element via swaps and counterparty risk, combined with securities lending and derivative usage, drive the complex classification despite the physical replication base and moderate risk profile."
}