Shari'ah and Maqasid analysis of financial derivatives

There have been recently increasing attempts to 'islamize' some financial derivatives. these attempts were initially meant to provide solutions to certain problems like the need to buy a currency or a commodity at a predetermined price on a future date for hedging purposes,but they later were developed to carry out the same strategies of speculative purposes as is the case for their conventional counterparts. the later development involves serious impacts on economic activities as 'speculation' has been singled out to be a major factor behind the eruption and escalation of the global financial crisis of 2007-2008. the paper analyses shari'ah objections for the prohibition of derivatives as they are practiced nowadays. in the course of the analysis the paper utilizes shari'ah objectives relating to the fiqh rules as its main investigative tool. this methodology has been adopted to help outline the correct islamization standard of such instruments,if possible at all,which is the acceptability of the instrument used as well as the purpose and the effect. having outlined the standard,the paper seeks to apply it to some applications of the 'islamization' process of derivatives in order to determine their acceptability or otherwise according to shari'ah rules.