{
    "type": "ETF",
    "ucits": true,
    "replication_method": "synthetic",
    "swaps": true,
    "derivatives": true,
    "leverage": false,
    "inverse": false,
    "complex_factors": [
        "Unfunded swaps",
        "Synthetic replication",
        "Counterparty risk",
        "Non-index securities held",
        "Medium risk rating (6)",
        "Sector concentration"
    ],
    "classification": "complex",
    "supporting_data": "The Invesco STOXX Europe 600 Optimised Media UCITS ETF uses unfunded swap agreements as a core part of its investment strategy to synthetically replicate the STOXX Europe 600 Optimised Media Index. The Fund holds a basket of equities that do not fully replicate the index and swaps the performance of these equities with the counterparty to achieve index returns. This introduces counterparty risk and derivative exposure inherent to synthetic replication. The KIID and PRIIPs KID explicitly mention the use of unfunded swaps and counterparty risk, with no collateral provided by the Fund to the swap counterparty. The risk profile is medium-high (category 6 out of 7), reflecting the volatility and complexity of the strategy. The Fund does not employ leverage or inverse exposure, but the synthetic replication and swap usage alone classify it as complex under MiFID II. The monthly factsheet confirms the synthetic replication method, swap fee of 10% p.a., and the Fund\u2019s UCITS compliance. There is no capital protection or structured product features. The Fund invests in equities but holds securities not contained in the index, adding complexity. The presence of swap fees and derivative counterparty risk further supports the complex classification. Although the Fund is UCITS compliant and has a straightforward index-tracking objective, the synthetic replication via unfunded swaps and associated risks make it complex under MiFID II rules."
}