{
    "ucits": true,
    "type": "ETF",
    "leverage": false,
    "derivatives": true,
    "swaps": true,
    "inverse": false,
    "replication_method": "synthetic",
    "complex_factors": "Synthetic replication with swap counterparty, counterparty risk, structured product features",
    "classification": "complex",
    "supporting_data": "The Fund is a UCITS ETF that aims to replicate the Stoxxu00ae China A 900 Minimum Variance Unconstrained AM Index. Although it is a UCITS fund (which generally presumes non-complexity), it uses a swap agreement with a swap counterparty to synthetically replicate the index performance. This synthetic replication involves derivatives integral to the investment objective, introducing counterparty risk and collateral risk, which are complex features under MiFID II. The Fund explicitly states the presence of counterparty risk due to the swap counterparty, and the use of derivatives is not limited to efficient portfolio management but central to the strategy. According to MiFID II Article 25(4)(a)(iv) and Article 57 of the Commission Delegated Regulation, UCITS ETFs that use synthetic replication with swaps are generally classified as complex because they embed derivatives and have risks difficult for retail investors to understand. The Fund does not use leverage beyond UCITS limits, but the synthetic replication and swap usage alone suffice to classify it as complex. The replication method is synthetic, derivatives are used as an inherent element of the strategy, and swaps are present. Therefore, the Fund fails the non-complex criteria of Article 57, particularly the exclusion of derivatives and the requirement for transparent, easily understood structures. This aligns with ESMA guidance and CESR analysis that synthetic ETFs and structured UCITS should be considered complex and subject to appropriateness assessments. Hence, despite being a UCITS, the Fund is complex under MiFID II due to its synthetic replication via swaps and associated risks."
}