Financial engineering is one of the most modern topics in the
financial sciences. It contributes significantly to finding alternatives and solutions to the problems facing investment in the financial market. Risk allocation , introducing new methods of financing , liquidating financial assets , evaluating financial instruments and determining the value of the institution. Which have contributed to the interdependence and increased efficiency of financial markets through the creation of financial instruments that can contribute to risk hedging.
Option contracts are one of the most important financial engineering
products, enabling investors to hedge against the risk of price volatility through different strategies. Our study has addressed the role and importance of trading these contracts on the Kuwait Stock Exchange.