Although investors face reinvestment risks by investing in short-term NCDs if the rate of interest falls, there is also a probability of getting a higher rate during reinvestment. However, as the change in the rate of interest is hard to predict in the very long term, investors face higher risks by investing in long-term NCDs. Due to the interest rate risk, either they may get stuck with an NCD with a lower interest rate, or may face capital loss while liquidating the investment in the secondary market.