{
    "type": "ETF",
    "ucits": true,
    "replication_method": "synthetic",
    "swaps": true,
    "derivatives": false,
    "leverage": false,
    "inverse": false,
    "complex_factors": "Unfunded Swaps, Synthetic Replication, Counterparty Risk",
    "classification": "complex",
    "supporting_data": "The Invesco STOXX Europe 600 Optimised Utilities UCITS ETF uses unfunded swap agreements as a core part of its investment strategy to synthetically replicate the STOXX Europe 600 Optimised Utilities Index. The KIID explicitly states the use of unfunded swaps with a counterparty to exchange the performance of a basket of equities held by the fund for the performance of the index. The fund does not physically replicate the index but holds securities that may differ from the index constituents. The PRIIPs KID confirms the synthetic replication method and highlights counterparty risk as a material risk. The monthly factsheet further confirms the synthetic replication method and swap usage, including a swap fee of 10% p.a., and notes that the fund's ability to track the benchmark depends on counterparties delivering swap performance. There is no leverage or inverse exposure, and derivatives are used only as part of the synthetic replication, not for additional risk management. The risk profile is medium (category 4 out of 7 in PRIIPs, 6 in KIID), reflecting market and counterparty risks. The presence of unfunded swaps and synthetic replication, combined with counterparty risk exposure, triggers the MiFID II complexity classification. Although the fund is UCITS compliant and has a straightforward index-tracking objective, the synthetic structure and swap counterparty risk make it complex under MiFID II rules."
}