{
    "type": "ETF",
    "ucits": true,
    "fund_name": "HSBC MSCI INDONESIA UCITS ETF",
    "replication_method": "physical",
    "leverage": false,
    "derivatives": false,
    "swaps": true,
    "inverse": false,
    "complex_factors": "Swaps usage for partial exposure, Emerging Markets concentration, High tracking error, Counterparty risk",
    "classification": "complex",
    "supporting_data": "The Fund aims to track the MSCI Indonesia Index primarily through physical replication of shares, confirmed by the monthly factsheet stating 'Physical - Full' replication method. However, the Fund may invest up to 10% of its assets in total return swaps and contracts for difference, which are derivative instruments and swap agreements, indicating synthetic elements in the strategy. The KIID and PRIIPs documents explicitly mention potential counterparty risk and derivatives risk, with derivatives used both for investment and efficient portfolio management purposes. The Fund is concentrated in a small number of securities (notably financials sector) and invests in an emerging market, which adds to complexity and risk. The Risk and Reward Indicator is high (category 7 in KIID, 5 in PRIIPs), reflecting high volatility and leverage risk due to derivatives usage. There is no leverage ratio above 1:1 or inverse/leveraged exposure, but the presence of swaps and derivatives for gaining exposure and efficient management triggers complexity classification under MiFID II. The Fund is UCITS compliant and does not have capital protection or structured features. Costs are straightforward with no performance fees, but derivative-related costs exist. The PRIIPs KID does not carry a specific comprehension warning but highlights the need for investors to understand risks and merits, consistent with complexity. Overall, the partial use of total return swaps and derivatives, combined with counterparty risk and emerging market concentration, leads to a MiFID II classification as complex despite physical replication being the primary method."
}