A: The hedging of foreign exchange futures can be divided into selling hedging and buying hedging. (1) Selling hedging, also known as short hedging, refers to selling first and then buying in the futures market. When exporters, commercial banks engaged in international business, or other units and individuals expect to obtain a sum of foreign exchange in a certain period of time in the future, in order to avoid the losses caused by the depreciation of foreign exchange against the local currency, they can adopt selling hedging. (2) Buying hedging, also known as long hedging, refers to buying first and then selling in the futures market. If importers or other units and individuals who need to pay foreign exchange are worried about the depreciation of their own currency against foreign exchange when paying foreign exchange, they can adopt the method of buying hedging, that is, buying a foreign exchange contract with roughly the same payment period in the futures market, and then selling it to make up for the loss of cash exchange with the profit of futures trading.