Islamic banks offer asset-backed financing. Islamic banks cannot process documents and it is because of the asset-backed nature which results in dynamic economic activities. Furthermore, Islamic banks must comply with conventional regulatory standards and Shariah standards. Islamic banks do not conduct business with companies producing tobacco, alcohol and other dangerous toxic substances. Islamic banks are not simply interest-free. Islamic banking transactions must avoid other elements of fraud, deception and uncertainty. It is implied from the Gharar-free nature of Islamic banking transactions that such complex conventional tools as options and captions are not permitted in Islamic banking. Furthermore, clean lending is not permitted in Islamic banking. Islamic banks provide financing to set up businesses. Therefore, Islamic banks do not offer credit cards, personal loans and bank account financing/overdrafts. Islamic banking also does not allow transactions in most derivatives. However, Salam and Istina are close alternatives to forward contracts in conventional banking. Extensive risk management actions will be reflected in long-term business success, but business success is not just a criterion of risk management procedures. It is due to the fact that commercial success depends on the quality of the product, its USPs, its effective marketing, its simplicity and also on the cultural, political and macroeconomic context in which the product is launched and marketed. According to Culp (2007) risk refers to those future events whose outcome is uncertain and can involve the possibility that the organization will be positively influenced or consequently negatively influenced by such events in terms of value. He also points out......half of the paper......d that there are some derivative instruments already available such as Salam and futures which have been developed keeping in mind the principles of Islamic banking and are necessary further efforts in order to develop tools that are Sharia compliant and thus help these organizations to make effective use of derivatives for hedging purposes and thus not miss the impossibility of applying such easy and convenient tools which are extremely important in the context current financial situation of uncertainty and change and beyond this it can be said that some essential elements must be guaranteed by these organizations before they can use such methods and that one of the most often stated requirements of Islamic finance today is to develop market and derivative instruments that allow such organizations to use their relatives to hedge risks.