Valuations in the equity markets are currently at elevated levels, with most indices trading above their five-year averages and close to peak levels (see table). Meanwhile, about 2.4 million new investors opened demat accounts in 2016, the highest since 2008, according to data from the depositories. Thus, not only are investors entering equities through the mutual fund-Systematic Investment Plan (SIP) route, they are also venturing directly into stocks. But, direct investing is fraught with risks, more so when valuations are at such high levels. If they experience losses in their very first foray, they could get turned off equities for