THE HEDGING STRATEGY ON THE VOLATILITY OF STOCK PRICES FOR THE COMPANY UNITED PARCEL SERVICES INC

In the paper, such financial instruments as options and futures. The structure of the options and how they can be used by investors for speculation and hedging. The research strategy of hedging against fluctuations in the stock United Parcel Services Inc (UPS Inc). This assignment will discuss and develop strategies for hedging an investment in the shares of company UPS Inc. This paper is organized as follows: the first part of the assignment will discuss strategies based on information available in June 2011; the second part will analyse the results of these strategies one year later in June 2012. The assignment will start with an introduction to options; present a discussion on how they are priced and how options can be used by investors for speculating and hedging.