Non-complex Financial Instruments

Non-complex Financial Instruments

The following are categorized as relatively non-complex financial instruments:

• Stocks listed for trading on a regulated market or on an equivalent market of a third country or in a Multilateral Trading Facility, provided they are stocks of companies, excluding stocks in collective investment schemes other than UCITS and stocks in which derivatives are incorporated or made available with credit provision.
• Bonds or other forms of securitized debt, listed for trading on a regulated market or on an equivalent market of a third country, or in a Multilateral Trading Facility, excluding those in which derivatives are incorporated or in which structures are incorporated that make it difficult for the client to understand the relevant risk or are made available with credit provision.
• Money market instruments, excluding those in which derivatives are incorporated or in which structures are incorporated that make it difficult for the client to understand the relevant risk.
• Shares or units in UCITS, excluding structured UCITS as referred to in Article 36(1)(2) subparagraph of Regulation (EU) No 583/2010.
• Structured deposits, excluding those in which structures are incorporated that make it difficult for the client to understand the risk of the performance or the cost of early withdrawal from the product.
• Other relatively uncomplicated financial instruments meeting one of the following criteria:
  • There are frequent opportunities for transfer, redemption, or other forms of liquidity provision, at prices that are publicly available to market participants and constitute either market prices or prices made available or validated by valuation systems independent of the issuer.
  • They do not entail any real or potential obligation for the client exceeding the cost of acquiring the instrument.
  • They do not include a clause, term, or activation element that could fundamentally alter the nature or risk of the investment or the amortization profile, such as investments that incorporate the right to convert the instrument into a different investment.
  • They do not include any explicit or implicit exit charges resulting in the transformation of the investment into illiquid, even if there are practically frequent opportunities for disposal, redemption, or other types of realization of the investment.
  • They are accompanied by sufficiently understandable information about their characteristics, and it is likely that this information is easily understood, so that the retail client is provided with the opportunity to make an informed decision on whether or not to conduct a transaction in the financial instrument in question.