{
    "name": "HSBC MSCI Emerging Markets Small Cap Screened UCITS ETF",
    "type": "ETF",
    "ucits": true,
    "leverage": false,
    "derivatives": true,
    "swaps": true,
    "inverse": false,
    "replication_method": "physical",
    "complex_factors": [
        "Derivatives for EPM and investment purposes",
        "Total return swaps and CFDs (up to 10%)",
        "Emerging markets exposure",
        "ESG screening complexity"
    ],
    "classification": "complex",
    "supporting_data": "The ETF uses derivatives for both efficient portfolio management and investment purposes, including up to 10% in total return swaps and contracts for difference. While primarily physically replicated, the potential use of derivatives beyond simple hedging, combined with exposure to illiquid emerging markets and complex ESG screening methodologies, introduces elements that may not be easily understood by retail investors. The presence of counterparty risk from swap usage and the fund's high risk category (6/7) further support the complex classification.",
    "confidence": 85,
    "risk_level": 6,
    "counterparty_risk": true,
    "liquidity_risk": true,
    "esg_complexity": true,
    "benchmark_complexity": "MSCI Emerging Markets Small Cap SRI ESG Universal Select Index with multiple exclusion criteria and ESG reweighting",
    "additional_notes": "While the fund is UCITS-compliant and primarily uses physical replication, the combination of derivative usage (even if limited), emerging markets exposure, and complex ESG screening methodology pushes it into the complex category under MiFID II. The fund's documentation explicitly mentions that it 'may not be appropriate for investors who plan to withdraw their money within 5 years,' which aligns with complex product characteristics."
}