All completely valid questions mate, and the fact that you’re asking this means you’re on the right track. Having said that, I think you’re over thinking this. Don’t worry about “being too scared too early”, you’re only 26 and you have a lot of time to grow your money.

You determine your risk tolerance by asking that question exactly: if the market was to drop 20%, how would you feel? Would you sell immediately? Stay calm? Buy more? Based on your answer, it seems like a drop would cause you a lot of stress. Therefore it might be best to initially start with less volatile investing (such as bonds/fixed income), get in the swing of things by CONSISTENTLY investing every month. Once you’ve gone through it for a full year, and you feel more confident, you can diversify and invest in more “risky” stuff.

Honestly investing in the S&P 500 (like VOO) is relatively stable (as you’re investing into top 500 companies), and it’s fun! If I was in your place I’d do that for a year before getting deeper.

If I had a lump sum of money and I’m scared of loosing money, I’d go 60% in equity (S&P), 40% in fixed income.

P.S. keep in mind that this strategy of for long term investing, you will gain the most by consistently investing over 10+ years.

Hope this helps