The call feature makes a bond riskier because
◦ the issuer may not have sufficient cash to redeem the bonds at the call date.
◦ investors who ignore the call will not be paid the bond's principal.
◦ after the bond is called, the investor will need to find a new place to invest, probably at a lower rate.
◦ the issuer may decided not to call the bond and it will have to be held to maturity or sold in the secondary market.