Offsetable Derivatives and Investor Risk Assessment

The authors acknowledge helpful comments from Orie Barron, Gauri Bhat (discussant), Kurt Gee, Dan Givoly, Guojin Gong, Yadav Gopalan, Jeremiah Green, Yihong Jiang, Henock Louis, Karl Muller, Samuel Melessa (discussant), Hong Qu, Stephen Ryan, and James Wahlen as well as workshop participants at the 2017 Brigham Young University Accounting Research Symposium, Duke University, University of Illinois at Chicago, Pennsylvania State University, the 2018 Midwest Accounting Research Conference, and the 2018 Financial Accounting and Reporting Section Midyear Meeting. The authors thank Nick Krupa and Lyndon Orton for their excellent research assistance. The paper was previously circulated under the title “Offsetable Derivatives and Financial Stability.”