{
    "type": "ETF",
    "ucits": true,
    "replication_method": "physical",
    "leverage": false,
    "derivatives": false,
    "swaps": true,
    "inverse": false,
    "complex_factors": "Swaps",
    "classification": "complex",
    "supporting_data": "The HSBC MSCI USA UCITS ETF primarily uses physical replication investing directly in shares of companies in the MSCI USA Index. 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 may use derivatives for efficient portfolio management and investment purposes. This swap usage is inherent to the investment strategy rather than solely for risk management, triggering complexity under MiFID II. There is no leverage or inverse exposure, and the Fund is UCITS compliant. The risk profile is medium-high (category 5-6), reflecting derivative and counterparty risks. The Fund does not employ capital protection or structured features. The presence of swap agreements and derivative instruments, even at limited levels, combined with counterparty risk disclosures, classifies the ETF as complex under MiFID II. The physical replication and straightforward index tracking reduce complexity, but the derivative and swap usage is decisive. No leverage or inverse exposure is present. The Fund\u2019s risk level aligns with a medium-high risk profile, consistent with derivative exposure and counterparty risk. No performance fees or complex fee structures are noted, and ongoing charges are standard (0.30%). The monthly factsheet confirms physical replication as primary but acknowledges up to 10% swap usage, validating the complexity classification. No capital protection or contingent bonds are involved. The PRIIPs KID does not carry a specific comprehension warning but confirms derivative and counterparty risks. Overall, the Fund\u2019s partial use of total return swaps and derivatives for investment purposes makes it complex under MiFID II despite physical replication being the main method."
}