(1) Buy hedging, also known as long hedging, refers to people who are short in the spot foreign exchange market, that is, people who have foreign currency liabilities, and make corresponding buying transactions in the forward foreign exchange market to prevent the exchange rate from rising when foreign currency is paid in the future. That is, buying futures in the futures market, using long positions in the futures market to ensure short positions in the spot market and avoid the risk of rising prices. Buying hedging means buying in the futures market before selling. Importers or people who need to settle foreign exchange often use buy hedging because they are worried that the exchange rate of their own currency will fall when settling foreign exchange.

{Corresponding to it is short hedging: (short hedging), also known as selling hedging, refers to a futures trading method in which traders first sell futures in the futures [1] market, and when the spot price falls, the profits of the futures market make up for the losses in the spot market, thus realizing the value preservation. }

(2) The profit of each futures period is 8693.48 USD =125000/1.0987-125000/1896.

20-point contract forward foreign exchange market profit 173869.66 USD =8693.48*20.

Three months later, the payment of 2.5 million euros was170141.71USD = 2,500,000/1.1023-2,500,000//kloc.

Make up for the losses in the spot market with the profits in the futures market,

The break-even profit is USD 3727.95 =173869.66-170141.71.