{
    "type": "ETC",
    "ucits": true,
    "replication_method": "synthetic",
    "leverage": false,
    "derivatives": true,
    "swaps": true,
    "inverse": false,
    "complex_factors": [
        "Synthetic replication using swaps",
        "Commodity futures rolling strategy",
        "Contango/backwardation effects",
        "Counterparty risk from swap agreements"
    ],
    "classification": "complex",
    "supporting_data": "The WisdomTree Cocoa ETC is classified as complex under MiFID II due to several key factors: 1) It uses synthetic replication via swap agreements to track cocoa futures, which introduces counterparty risk; 2) The rolling of futures contracts creates contango/backwardation effects that require specialized knowledge to understand; 3) The product's risk profile (rated 6/7) indicates high complexity; 4) The PRIIPs KID includes a comprehension warning, suggesting the product may be difficult for retail investors to understand. While the ETC is UCITS-eligible and fully collateralized, the use of derivatives for core exposure rather than just efficient portfolio management, combined with the commodity futures rolling strategy, makes this a complex product. The fact that it's structured as a debt security rather than an equity-based ETF also contributes to its complexity.",
    "confidence": 90
}