{
    "type": "ETF",
    "ucits": true,
    "fund_name": "HSBC EUROPE SUSTAINABLE EQUITY UCITS ETF",
    "investment_objective": "Track the FTSE Developed Europe ESG Low Carbon Select Index",
    "primary_asset_class": "Equity",
    "geographic_focus": "Developed Europe",
    "replication_method": "physical",
    "swaps": true,
    "derivatives": false,
    "leverage": false,
    "inverse": false,
    "complex_factors": [
        "Swaps usage",
        "Concentration risk",
        "Securities lending"
    ],
    "classification": "complex",
    "supporting_data": "The Fund aims to track the FTSE Developed Europe ESG Low Carbon Select Index primarily through physical replication of equities. However, it may invest up to 10% of its assets in total return swaps and contracts for difference, indicating synthetic elements. The Fund also may invest up to 10% in other funds and engage in securities lending up to 30% of assets (not expected to exceed 25%). The use of total return swaps, even if limited, and contracts for difference, combined with counterparty risk disclosures and securities lending, introduces complexity under MiFID II. The Fund is UCITS compliant and does not employ leverage or inverse strategies. The risk profile is high (category 6 in KIID), reflecting market volatility rather than leverage. The PRIIPs KID confirms medium risk (category 4) but notes investment leverage risk due to derivatives use. The Fund's benchmark has a high concentration, which may increase tracking error and complexity. No capital protection or structured features are present. Derivatives are used primarily for investment purposes rather than solely for risk management, so derivatives flag is true. The presence of swaps mandates classification as complex under MiFID II. The physical replication method is predominant but partial synthetic exposure exists. No leverage or inverse exposure is present. The Fund is UCITS compliant. Overall, the limited but explicit use of total return swaps and contracts for difference, combined with securities lending and counterparty risk, drives the complex classification despite a straightforward equity index tracking objective.",
    "risk_level_assessment": "The Fund's stated risk profile is high (category 6 in KIID) and medium (category 4 in PRIIPs KID), reflecting market volatility and derivative usage. The complexity arises mainly from the use of swaps and securities lending rather than leverage or structured products. This aligns with the MiFID II complexity assessment, where derivative and counterparty risk elevate complexity even if leverage is absent."
}