{
    "type": "ETF",
    "ucits": true,
    "leverage": false,
    "derivatives": true,
    "swaps": true,
    "inverse": false,
    "replication_method": "physical",
    "complex_factors": [
        "Derivatives for replication",
        "OTC derivatives with counterparty risk"
    ],
    "classification": "complex",
    "supporting_data": "The UBS Factor MSCI USA Quality Screened UCITS ETF exhibits several characteristics that classify it as a complex instrument under MiFID II. While it primarily uses physical replication, the KIID explicitly mentions the use of derivatives, including OTC derivatives, to achieve its investment objective. The presence of counterparty risk from OTC derivatives, even if collateralized, introduces additional complexity. The fund's risk category of 6, indicating very high volatility, further supports this classification. The use of derivatives for purposes beyond efficient portfolio management (EPM) and the potential for significant tracking error due to derivative trading costs contribute to its complexity. Additionally, the fund's exposure to complex indices and the potential for illiquid securities within the index add layers of complexity that may not be easily understood by retail investors.",
    "confidence": 85,
    "counter_argument": "Some may argue that the fund is non-complex due to its primary use of physical replication and straightforward equity exposure. However, the explicit mention of derivatives, including OTC derivatives, and the associated counterparty risks, along with the high volatility and potential for tracking error, outweigh this argument. The fund's complexity is further evidenced by its risk profile and the sophisticated nature of the index it tracks, which requires a deeper understanding of factor-based and ESG-screened indices.",
    "risk_level": 6
}