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haha. the concept is not complicated. the workings are tho.
in simple terms, you entered into a contract with a financial institution (eg. a bank) to buy a foreign currency at an agreed exchange rate (plus bank fees obviously lol) at a future time. then during this period, whether AUD goes up or down won't effect you.
if AUD goes up then u will "lose" (ie. you need to pay more to buy the currency than you will need to if you didn't hedge) but if AUD goes down then you will "gain".
once currency is hedged, manufacturers can set the selling price of the product they sell, free of any currency movement so the price can stay constant. obviously there are other factors that will effect price but FX will not be one.
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