{
    "type": "ETP",
    "ucits": false,
    "leverage": true,
    "derivatives": true,
    "swaps": true,
    "inverse": true,
    "replication_method": "synthetic",
    "complex_factors": [
        "Leverage (3x short exposure)",
        "Use of swaps with counterparty risk",
        "Synthetic replication",
        "Complex index with daily leverage reset and compounding effects",
        "Collateralized swap exposure",
        "High risk rating (7/7)",
        "Potential for total loss of capital",
        "Opaque payoff structure due to daily reset and compounding",
        "Counterparty and collateral risk"
    ],
    "classification": "complex",
    "supporting_data": "The GraniteShares 3x Short Amazon Daily ETP is an exchange traded product (ETP) that seeks to replicate -3 times the daily performance of Amazon via a swap with Natixis as the swap provider. The product uses synthetic replication through a collateralized swap, exposing investors to counterparty and collateral risk. It employs leverage of 3x inverse daily exposure, with a daily reset of leverage causing compounding effects that make the return over periods longer than one day complex and difficult to understand for retail investors. The product is classified with the highest risk rating (7/7), indicating very high risk and potential for total loss of capital. The structure involves derivatives integral to the investment objective, which under MiFID II Article 254 and Delegated Regulation EU 2017/565 Article 57, and ESMA guidelines, classifies it as complex. The product is not UCITS compliant, uses synthetic replication, embeds swaps, and has significant leverage and inverse exposure. These factors combined mean the product is complex and requires an appropriateness assessment before sale to retail investors."
}