The document must be provided before a retail investor buys a covered product, which includes structured products, most funds, contracts for difference and insurance-based investments.
Its summary risk indicator combines market and credit risk into one number, cost disclosure includes a reduction-in-yield figure, and performance scenarios illustrate stressed, unfavourable, moderate and favourable outcomes.
One practical consequence for European traders is that US-listed exchange traded funds are generally unavailable at retail because their issuers do not produce a KID. That is a documentation problem, not a judgement about the funds.
Related: mifid-ii, esma, etf, client-categorisation, prospectus