{
    "type": "ETF",
    "ucits": true,
    "replication_method": "physical",
    "leverage": false,
    "derivatives": false,
    "swaps": true,
    "inverse": false,
    "complex_factors": "Currency Hedging via OTC Swaps",
    "classification": "complex",
    "supporting_data": "The Amundi MSCI Japan UCITS ETF EUR Hedged Dist is a UCITS-compliant ETF that physically replicates the MSCI Japan Net Total Return Index primarily through direct investment in underlying equities, with possible sampling replication. The fund employs a daily currency hedging strategy to minimize EUR/JPY currency risk, achieved via OTC swap agreements with counterparties such as Morgan Stanley Bank AG and Societe Generale. The factsheet explicitly states the use of OTC swaps for currency hedging, with counterparty exposure capped at 10% of total assets, consistent with UCITS rules. Although the derivatives (swaps) are used solely for currency risk management and not for investment leverage or performance amplification, the presence of funded swap agreements and counterparty risk exposure triggers MiFID II complexity classification. The fund has no leverage, no inverse or amplified exposure, and invests directly in liquid Japanese equities. The risk profile is moderate (SRRI 4/7), reflecting market and derivative risks but no structural leverage or capital protection. The PRIIPs KID does not include a comprehension warning but notes medium risk and liquidity risk. Costs are straightforward with a 0.20% ongoing charge and no performance fees. Overall, the complexity arises from the embedded currency hedging swaps and associated counterparty risk, which under MiFID II rules classify the ETF as complex despite its physical replication and straightforward equity exposure."
}