{
    "type": "ETP",
    "ucits": false,
    "replication_method": "synthetic",
    "leverage": true,
    "derivatives": true,
    "swaps": true,
    "inverse": false,
    "complex_factors": [
        "Leverage",
        "Swaps",
        "Synthetic replication",
        "Daily reset and compounding",
        "Counterparty risk"
    ],
    "classification": "complex",
    "supporting_data": "The WisdomTree FTSE 100 2x Daily Leveraged product is a fully collateralised, UCITS eligible Exchange Traded Product (ETP) that provides 2x leveraged exposure to the FTSE 100 index. It achieves this exposure through a fully collateralised swap structure, explicitly described as using swaps to replicate the leveraged index performance. The product is not a UCITS fund but is UCITS eligible, and it is structured as a certificated, registered, collateralised debt security rather than a traditional ETF. The replication method is synthetic, relying on swap agreements with counterparties, with collateral held at a third party custodian (Bank of New York Mellon). The product uses daily leverage with a 2x leverage factor that resets daily, leading to compounding effects and deviation from simple 2x index returns over longer periods. The product carries significant counterparty risk, as the issuer depends on swap counterparties to maintain the exposure, and collateral may not fully cover losses in case of default. The risk indicator is at the highest level (7/7), reflecting the high risk and complexity. The product is intended for informed investors with specific knowledge of leveraged products and derivatives. Costs include management fees and significant transaction costs related to maintaining the leveraged swap exposure. The product is not capital protected and can result in total loss of capital. The use of swaps, leverage, daily reset, and counterparty exposure are all complexity indicators under MiFID II. There is no physical replication or direct purchase of underlying securities. The product is not suitable for retail investors without specific knowledge. These factors combined lead to a classification of 'complex' under MiFID II rules."
}