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# Knock-In Forward
{% hint style="info" %}
The Knock-In Forward is a simple and yet efficient hedging strategy that offers a worst case guaranteed strike rate.
The client has the right but not the obligation to hedge at this rate provided that spot does not trade at or beyond a pre-determined Knock-In Rate. Else, the client is locked into a synthetic forward rate obligation at that strike rate.
{% endhint %}
### **Payoff Diagram:**
### **Payoff at Expiry:**
At expiry if EURUSD fixes:
* Above the Strike, the client is fully protected at the Strike on 100% of the Notional.
* The profit on the derivative will fully net off against the loss on the underlying exposure.
* Between the Strike and above the Knock-In Barrier, the client can participate in the favourable movement and transact at the improved Spot Rate.
* Below the Knock-In Barrier, the client will find itself obligated to trade at the Strike level on 100% of the Notional.
---
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