This paper identifies the various risks in sukuk structures, sharia’h permissible risk hedging techniques and certain regulatory, legal and infrastructural challenges which this novel product is facing in the modern global financial system. The analysis demonstrates that though sukuk is a viable device for asset-monetization, its complex structure necessitates the development of innovative sharia’h permissible risk management tools which can be formulated within the sharia’h framework of Al-Khiyar. Since the sukuk originated from emerging markets which are mostly characterized with secrecy and institutional imbalances, these circumstances create great hardships for the bankers and regulators to observe the progress of the corporate being financed. In this research it is argued that this situation strongly demands greater transparency and disclosure in sukuk structures coupled with profound regulatory, legal and institutional reformation in emerging markets. The research finally argues that sustainable market for the sukuk is doomed with uncertainties, unless the innovative process for sharia’h compatible risk hedging techniques continues and aforesaid reformations are initiated. Keywords: Sharia, Sukok, Risk, Islamic, Finance, Management.