Task: Class Definition Understanding (ontology: Business_Finance/Financial_Industry_Business_Ontology)

Which of the following definitions best describes 'commodity swap'?

A. return swap in which payments are based on a fee paid to the seller of the swap and on a floating reference price based on changes in the level of an index from an initial level to a level observed on some valuation date(s)
B. futures contract to buy or sell a predetermined amount of a commodity at a specific price on a specific date in the future
C. commodity derivative that includes, without limitation, any swap for which the primary underlying notional item is a physical commodity, or the price, or behavior of the price, or the level of a commodity index, or other aspect related to a physical commodity
D. derivative instrument whose primary underlying notional item is based on something related to the weather, for example, the average temperature in Chicago in January

Answer: commodity derivative that includes, without limitation, any swap for which the primary underlying notional item is a physical commodity, or the price, or behavior of the price, or the level of a commodity index, or other aspect related to a physical commodity