{
    "type": "ETF",
    "ucits": true,
    "replication_method": "physical",
    "leverage": false,
    "derivatives": false,
    "swaps": true,
    "inverse": false,
    "complex_factors": "Swaps usage",
    "classification": "complex",
    "supporting_data": "The HSBC FTSE 100 UCITS ETF primarily uses physical replication investing directly in shares of the FTSE 100 Index constituents. However, the KIID and PRIIPs KID explicitly state that the Fund 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 monthly factsheet confirms physical full replication as the main method but acknowledges derivative usage for efficient portfolio management and gaining exposure when direct investment is impractical. The Fund also engages in securities lending up to 30% of assets. The derivatives and swaps are used for efficient portfolio management and not for leverage or amplification of returns, and the Fund does not employ leverage or inverse strategies. The risk profile is medium to high (category 4 in PRIIPs, category 6 in KIID), reflecting market volatility and derivative risks. The presence of swap agreements, even at limited exposure, triggers MiFID II complexity classification because swaps are inherently complex instruments with counterparty risk. There is no leverage above 1:1, no capital protection, no structured features, and no contingent bonds. The Fund is UCITS compliant and has a straightforward index-tracking objective with physical replication as the main method. Despite this, the use of swaps and derivative contracts for exposure and risk management means the Fund is classified as complex under MiFID II rules."
}