{
    "type": "ETF",
    "ucits": true,
    "replication_method": "synthetic",
    "swaps": true,
    "derivatives": false,
    "leverage": false,
    "inverse": false,
    "complex_factors": "Unfunded Swaps",
    "classification": "complex",
    "supporting_data": "The Invesco Utilities S&P US Select Sector UCITS ETF uses unfunded swap agreements to achieve its investment objective, explicitly stated in the KIID and PRIIPs KID. The Fund holds a basket of equities that do not fully replicate the index and swaps the performance of these equities for the performance of the S&P Select Sector Capped 20% Utilities Index. This synthetic replication method introduces counterparty risk and derivative exposure inherent to the swap agreements. The Fund does not employ leverage or inverse strategies, and the derivatives are used as an inherent part of the investment strategy rather than solely for risk management. The risk profile is medium-high (risk category 5-6), reflecting the risks associated with synthetic replication and counterparty exposure. The ongoing charges include a swap fee of 0.10% p.a., further confirming the use of swaps. There are no capital protection features or structured products involved. The PRIIPs KID does not carry a specific comprehension warning but highlights the reliance on counterparties and the absence of capital guarantee. Given the use of unfunded swaps and synthetic replication, the ETF is classified as complex under MiFID II rules despite its straightforward sector equity exposure and absence of leverage. This complexity arises from the derivative-based replication and counterparty risk, which may not be easily understood by retail investors."
}