Locking in an exchange rate with a fixed forward contract means you know exactly what exchange rate you’re getting
Why utilize a forward hedge?
By locking in an exchange rate through a fixed forward contract, you gain certainty regarding the exact exchange rate applicable on the day of contract settlement. The benefit lies in the fact that, even if the market rates move unfavourably, you are protected from potential losses since your rate is locked in.
Additionally, this approach grants you increased control over the potential impact of exchange rate fluctuations on your objectives, allowing you to pursue your goals with greater confidence.