Well you seem to be touching on two different topics, Raja.
One topic is regarding how much of the value of your BTC stash would you be willing to trade with, and another topic is what kinds of indicators you use to decide whether to get in or out.
This is how I see any trade or swinging: if there's a good indicator, trade with a big stash; however, if there's a bad or weak indicator, trade with a little stash.
That is not necessarily bad logic - even though I personally believe that you got the facts a little bit wrong, at least in terms of using changes in the relative size of market cap as if it were a good indicator... It's like you are just looking for an excuse to get into shit coins, and as if you want to gamble with your money.
I doubt anyone is going to stop you here from your gambling inclinations.... hahahahahaha.. but at least, like you said, it is not a really BIG portion of your stash., even though it seems like too much to me, especially if you seem to be in your BTC stash accumulation phase, which seems to be the case based on your asserted BTC stash size.
Each of those are individualistic determinations, and I will let you know that I have a pretty decent proportion of my wealth in bitcoin as compared with my traditional investments (such as stocks and things like that), and I also have a very tiny percent into shitcoins. So only about 1% - maybe 2% upon favorable fluctuations, is in shit coins, and I find little to no value in trading any kind of shit coins.
Well, 10% of my whole BTC stash doesn't even make a complete half of a full bitcoin, so there's definitely a whole lot of difference in your way of thinking and in my way of thinking when it comes to the "percentage of BTC holding that you may risk on sh!tcoins". If my 10% holdings of BTC were equivalent to more than $50k or something, I'd probably not be thinking of risking much in alts as I know that they're similar to leveraged gambling; however, when that 10% makes less than $5k, I think it's fine to just go ahead and risk it as it's not a very big amount, especially when the swing setup is looking quite strong (at least to me).
Again, it seems to me that your mind is kind of made up, and you really want to gamble and you are convinced that you have yourself some decent indicators, so you might be correct that it is best to learn how to balance for yourself, rather than just accepting the conservatism of other peeps on the interwebs, like me.
So, maybe in the end, you will be correct, and you will make more money than I expected, even though I believe that what you are saying is too risky, whether you are saying that 10% is only $500 or $5,000 or $50k.... To me, it seems that you are in an accumulation phase, and you are engaging in gambling because you believe that you can build your BTC faster if you engage in a kind of timed risk... and sure, maybe you end up being correct, even if I would be more inclined towards more prudence and maybe only taking a lower percentage to play with.
Furthermore, if you have only been in BTC since about the time of your registration, it has taken you a decently long time to build your BTC stash to the level that it is, currently, and various forms of dollar cost averaging, buying on dips and things like that would probably be better than wasting time and energies dabbling in shitcoins... but whatever, do what you are gonna do.
During shitcoin pumpening season in 2017, there were guys (and maybe even a gal or two) who were putting nearly all of their bitcoins into shitcoins, and they did pretty decently (on paper) as long as they figured out a good time to get out. Some of them got burned too, because they could not figure out when to get out, so yeah, Raja, your suggestion that this is a good time to get into shitcoins based on expectations about market cap, might work out for you, but I personally believe that shit coin purging is going to continue for a quite a bit longer, but hey, I might be wrong, and surely there are a lot of arguments out there, currently, that alt coin pumpening season is coming is coming is coming, and yeah they might be right.. but then again, they might be desperately attempting to save their bag holdings of shit to stop bleeding so much, even though their bleeding is not yet close to being done.
We probably will never get to see another altseason as good as the one of 2017, which especially includes the bull runs of all those low-caps that pumped 1000x and more in January 2018. Even if you take a look at the top 5 coins (by market-cap), it's quite funny that:
-Ethereum: still no scaling, no sharding, no PoS, no 2.0.
-Ripple: lol, centralized
-Bitcoin Cash: lol, fake
-Litecoin: almost every sh!tcoin got more Github commits than LTC in the last few years.
-Binance Coin: overvalued, will probably also be categorized as security in the US as it fits in every category of Howey test.
So, yeah, you end up investing in shit, and if you go further down the list, they don't really get better, so yeah, sure they can pump, but jeez, why even bother getting scammed out of a portion of your 10% when you can focus on bitcoin and figure out ways to play within bitcoin without getting distracted by meaningless scammy nonsense? As you seem to recognize, somewhat.
...so ultimately, you come back to BTC. However, when you open and look at Bakkt's official website, you notice that everywhere they've mentioned "digital asset
s", which makes you realize that the crypto story doesn't really end up on BTC (I know this is quite irrelevant to this thread as it's made specifically for BTC maximalists, but this is just my opinion
).
I think what you say is relevant in this context. You are saying that because some stupid-ass traditional financial institutions are wanting to go beyond bitcoin, therefore, it is worth it for you to diversify into crap (even if only short term?) Why the fuck do you believe that coinbase had been offering various index (or crypto packages) or whatever they were calling them? Does not mean that they know anything, but it certainly means that they can make more on fees if they bundle cryptos together.
There are a lot of smart people who are structuring their businesses like dumbasses because they are trying to diversify (or dilute) their bitcoin focus with crap, so yeah, you want to use that as a justification because you know that there is pumpening power.. and maybe the pumpening will happen with some alts and maybe it will not... but that does not mean that you invest 10% of your bitcoin value based on such speculation.
I would say once you build your BTC stash to something that you feel is going to sustain you, then at that point maybe you could shave off a little bit of BTC for alt coin gambling, and it does not even need to be 10%, unless you really feel that you have some kind of solid scoop beyond the scoop that you are currently feeling, which is mere changes in BTC market dominance and the fact that some smart people (or institutions) are talking positively about shitcoins.
When it comes to shitcoins, I am nearly a total chicken shit, so likely I am not the right person to ask regarding any of them, because even during their outrageous pumpening in 2017, I remained sufficiently happy with my mediocre 78x return on bitcoin value (from 2015 to late 2017).
"mediocre" 78x return
If you recall during the boom in 2017, and probably even started somewhat in 2016, there were a lot of shitcoin pumpers including those in ethereum and some of the varlous altcoins that were making fun of BTC because BTC's returns were less than theirs... especially during certain periods of time, but I am not sure if those shittalkers were able to get in and out of their investment before their performance went to the toilet, especially relative to bitcoin. A lot of them just kept hanging onto their shitcoin, so bitcoin ended up passing them up greatly, and even bitcoin did not have the various scams attached to it, either, so usually it was easier to get out of bitcoin if needed, as compared with getting locked into some of the various shitcoins that became even harder to get out of when they started to tank.
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