{
    "type": "ETF",
    "ucits": true,
    "fund_name": "UBS (Lux) Fund Solutions - MSCI Japan UCITS ETF",
    "investment_objective": "Passive management aiming to replicate the MSCI Japan Index (Net Return) through direct investments in all or substantially all component securities and/or through the use of derivatives where direct replication is not possible or efficient.",
    "primary_asset_class": "Equity",
    "geographic_focus": "Japan",
    "replication_method": "physical",
    "swaps": true,
    "derivatives": false,
    "leverage": false,
    "inverse": false,
    "complex_factors": "Use of OTC derivatives (swaps) for efficient index replication and counterparty risk exposure",
    "classification": "complex",
    "supporting_data": "The ETF primarily uses physical replication (full replication) investing directly in the underlying Japanese equities of the MSCI Japan Index. However, the KIID and PRIIPs KID explicitly state that the fund may use derivatives, including OTC derivatives such as swaps, to gain exposure when direct replication is not practicable or to generate efficiencies. The use of OTC derivatives introduces counterparty risk, which is mitigated by a collateral policy. The fund does not employ leverage, inverse or amplified exposure. The risk profile in the KIID is high (category 6) due to equity market volatility, but the PRIIPs KID shows a medium risk (category 4) reflecting a more conservative risk assessment over a 5-year horizon. The fund is UCITS compliant. The monthly factsheet confirms physical full replication as the primary method, with no mention of synthetic replication or leverage. The presence of OTC derivatives (swaps) for replication efficiency and the associated counterparty risk triggers MiFID II complexity classification despite the absence of leverage or complex underlying assets. There are no capital protection features or structured contingent returns. Costs are straightforward with a low TER and no performance fees. The fund is suitable for retail investors with basic financial understanding but the derivative usage and counterparty risk elevate complexity under MiFID II rules.",
    "risk_level_assessment": "The fund's stated risk profile is high (6/7) in the KIID due to equity market volatility, but medium (4/7) in the PRIIPs KID reflecting a 5-year holding period and risk mitigation. The complexity classification is driven by the use of OTC derivatives (swaps) and counterparty risk rather than leverage or complex underlying assets."
}