[edited out]
..., I wanted some kind of explanation or defination if there is one to what a balanced aggressive bitcoin investment situation should be ....
I think that these points have been sufficiently explained, especially since the punchline is that you have to figure out for yourself in terms of your boundaries, and yeah, if you end up going over the boundaries, you might not realize until it is too late. How can anyone else figure out those kinds of matters for you? You gotta figure out how much of an emergency fund, reserve and/or float that you need based on your own balancing of matters.. and yeah, I cannot tell you that if you are worried about it, you should error on one side or the other.. that's up to you, but if you know all of the various factors with which you are working, then your putting them to the test and balancing them out with the passage of time, you are going to likely find out how much to put on one side or another he and there probably is no "perfect" balance, but instead something in the ballpark of feeling comfortable and/or sufficiently comfortable.. but maybe also a bit uncomfortable at the same time.
But yeah if you are stacking bitcoin for 4 years or more and you are getting close to having a whole years income/expenses in bitcoin, you may well start to feel more comfortable, but yeah, maybe you won't and maybe you might consider that you have to do more or change your tactics.. How can anyone else tell you how much of a balance you should enter into?
Additionally, portfolio diversification can play an important role in mitigating risk effectively.
Why? If you are a brand new investor, then why diversify? and diversify into what? shitcoins? How about you have an extra disposable income of $100 per week that you are investing into bitcoin. You want to diversify into something else with that? Your $100 per week is not going to go up, but instead it is going to get diluted, and what good would that do? Dumb idea to diversify for the mere sake of diversifying.. However, if you have accumulated 1-2 years or more worth of income/expenses in bitcoin, then sure maybe at some point it might start to make sense to have some other investments...
It seems to me that you threw in the idea of "diversifying in order to offset risk" because you wanted to sound smart... but without a context it makes little sense, unless you are just spouting out shitcoin talking points within a bitcoin thread.