Calculate the net cash flow (in euros) to maintain the desired hedge. Show your calculations.

With the US dollar currently trading at a forward premium and US interest rates lower than Spanish rates, Delgado recommends trading against the forward rate bias to earn additional return from a positive roll yield.

Rosario Delgado is an investment manager in Spain. Delgado’s client, Max Rivera, seeks assistance with his well-diversified investment portfolio denominated in US dollars.
Rivera’s reporting currency is the euro, and he is concerned about his US dollar exposure.
His portfolio IPS requires monthly rebalancing, at a minimum. The portfolio’s market value is USD2.5 million. Given Rivera’s risk aversion, Delgado is considering a monthly hedge using either a one-month forward contract or one-month futures contract.