Ex-Goldman CEO Blankfein Has 98% in Stocks—But Says You Should Just Buy Index Funds

Source: My First Million | Published: 2026-06-16T11:16:43Z

Blankfein day-trades individual stocks on his iPad with 95% of his portfolio in equities, yet his advice for everyone else is dead simple: just buy an S&P 500 index fund.

98% of His Money Is in Risk Assets

Blankfein's personal portfolio is almost entirely equities. Roughly 95% sits in equity assets, about three-quarters of which are individual stocks, with only a small slice in ETFs. He admits the split is "probably 90% individual stocks, 10% ETFs." His holdings cluster around three areas he knows best: tech, energy, and financial services — tech because that's where the trend is heading, the other two because of his decades of industry experience.

His stance on big tech is blunt: keep riding the wave as long as it's going up; worry about the downside when it stops. He holds all the major cloud companies, plus what he calls the "second tier" — firms like Oracle that are smaller but still significant. He's quick to note he's not plugged into Silicon Valley circles; many startups considered common knowledge there are names he's never heard of.

His Advice to Regular People Is the Opposite of What He Does

When asked how ordinary investors should approach the market, Blankfein's recommendation is the polar opposite of his own strategy: young people should put their money in diversified equity index funds like the S&P 500. He says that's what Buffett would tell you, too. If you want more tech exposure, add a tech ETF — though the index already skews heavily toward tech by market cap.

He explains that he can afford to trade individual stocks daily because of two prerequisites: first, he's been doing this professionally for decades; second, no matter how much he wins or loses, it won't materially change his life. For him, it's a hobby. For most people, it isn't.

The Gap Between Winners and Losers Is Shockingly Small

Having managed large teams of traders, Blankfein observed that the skill gap between top performers and those who wash out is remarkably narrow. He compares it to a golf tournament — the winner might lead by a single stroke, with six people tied for second. But it's winner-take-all; second place might walk away with nothing.

Entertainment works the same way. The best actor gets first pick of any role; the second-best might still be waiting tables at night. Professional sports are even more brutal — the best athlete in a high school lands a minor-league contract, but the conversion rate from the minors to actually making a living in sports is roughly 2%. The market only offers full-time opportunities to the top 0.01%.

Almost None of the Powerful People He's Met Were Geniuses

Blankfein says that for the vast majority of successful people he encountered throughout his career, he could understand how they got where they are. The number of people who made him think "I simply cannot see the world the way this person does" is vanishingly small. Elon Musk is one of them — Goldman underwrote many of Musk's ventures, so they had plenty of dealings.

But the point he really wants to make is the flip side: the people at the very top, after finishing a speech, almost always ask first, "How did I do?" They crave validation. They're deeply insecure. Their kids don't necessarily like them. Many of the most successful people are driven precisely by that insecurity.

Luck matters just as much. He became Goldman's CEO because his predecessor was nominated for Treasury Secretary. If that person had stayed five more years, Blankfein might have missed his window entirely.

Buffett's $5 Billion and a Phone Call

During the 2008 financial crisis, Warren Buffett decided to invest in Goldman Sachs. Blankfein had previously sounded out Buffett's interest and been turned down. Then Buffett called back on his own, offering to put in $5 billion for preferred shares — an instrument somewhere between a loan and equity.

Blankfein said he wanted to walk Buffett through all the risk factors. Buffett's reply:

"Lloyd, I know you well enough to know you're already worrying enough for both of us."

Blankfein kept pushing. Buffett added: Berkshire is an insurance company, and $5 billion, even if it were a total loss, "wouldn't be as bad as a major hurricane hitting the East Coast." It was a joke, but it also conveyed the scale.

The real value of that money wasn't the amount — Goldman wasn't short on cash. What they lacked was market confidence. Similar institutions were collapsing or in distress. Goldman wasn't, but nobody believed it. Buffett's endorsement was worth more than the $5 billion itself.

Buffett had one condition: Blankfein couldn't sell his own shares before Buffett sold his. No written contract — just a verbal commitment. Blankfein says that in their world, most deals aren't put on paper. Your reputation is your currency; lie once and no one will ever do business with you again.

Missing SpaceX Is One of His Biggest Regrets

Blankfein thought SpaceX was too expensive at a $100 billion valuation. The market now puts it at around $1.75 trillion. He uses an earlier example to illustrate his pattern of misjudgment: when mobile phones first appeared, his thinking was — there are payphones everywhere, who would want to carry around a bulky device with a battery that lasts 15 minutes?

"I've missed far more things than I've caught."

Fearing Risk Is More Dangerous Than Taking It

After the financial crisis, fear permeated Goldman Sachs. At one meeting, twenty partners presented ideas and every single one was shot down as "too risky." Blankfein lost his temper: we're scaring ourselves into paralysis.

His view: a good risk manager doesn't just suppress risk — sometimes the job is precisely to encourage people to take risks. Without risk, there's no growth, no entrepreneurship, no progress. Yes, taking risks means you might lose other people's money, and that's terrible. But the alternative — never taking any risk — means you'll never lose money, but you'll also never get anywhere.

He's observed that the best traders share one trait: resilience. They focus on new information, not past losses, and adjust quickly.

From Brooklyn Public Housing to Goldman Sachs CEO

Blankfein grew up in a public housing project in East New York, Brooklyn. His father worked the night shift at the post office, having previously driven trucks, clerked at a store, and gone through a stretch of unemployment. Before college, Blankfein had been to Manhattan only three times, had never flown on a plane, and had never left the country. He calls himself "an urban hick."

He points to a striking fact: if you look at the list of America's most successful or wealthiest people, you'll find almost none of the old dynastic names — no Morgans, no Rockefellers. Most come from middle-class backgrounds, achieved upward mobility in a single generation, created wealth for others, and kept a portion for themselves.

$500 Changed How He Thinks About Giving

Freshman year of college, after buying textbooks and a sweater, Blankfein had $11 left. This was around 1971. Someone suggested he try the school's financial aid office. He filled out a form — one column for "what you have," another for "what you need" — carefully engineering a gap of exactly $500.

A clerk looked at the form and wrote him a check for $500 on the spot. No interrogation, no humiliation. He says it was the first time in his life someone treated him without nickel-and-diming.

That moment shaped him for decades. He later co-chaired Harvard's financial aid fundraising campaign. He says he doesn't just think about giving — he thinks about what it feels like to receive. How you give matters as much as what you give. People should walk away with their dignity intact.

"That $500 — I hope I've repaid it many, many times over. But I'm still telling you this story today. That was more than fifty years ago."

Giving His Kids Wealth, Then Feeling Conflicted About It

All three of Blankfein's children worked briefly at Goldman Sachs but eventually left — the pressure of carrying the Blankfein name was too much, with people constantly questioning whether they'd gotten in on connections. He says the burden on them was heavy: they had to show up earlier and stay later than everyone else just to prove themselves.

He admits to a contradictory impulse: he gives his kids money because he can and because they're good people. But after giving it, he can't help saying, "You have no idea how hard I had it — you have it too easy." Then he realizes — they have it easy precisely because he gave it to them. Giving and then regretting it — he knows the cycle is illogical, but he can't stop it.

Only Three Paragraphs of Your Obituary Should Be About Goldman

When Blankfein first made partner at Goldman, a senior partner laid down some rules: stay far away from anything resembling sexual harassment; be extremely conservative on taxes; set up a charitable foundation and use it actively. The last one: if your obituary runs nine paragraphs, make sure no more than three are about Goldman Sachs.

Blankfein says that after nearly 40 years at the firm, he was never going to pull that off — even the subtitle of his memoir includes "Goldman Sachs." But he understands the spirit of the advice. After retiring, he started learning new things: cosmology, linguistics, anthropology, taking courses online. He says studying history is useful for business, too, because history doesn't repeat itself, but it rhymes.

He Reads History to Stay Calm During Panic

Blankfein has been reading about the American Revolution and recommends Rick Atkinson's three-volume series, starting with The British Are Coming. He also recommends Barbara Tuchman's A Distant Mirror — a book that follows the life of a 14th-century French nobleman through the Black Death, the papal schism, and the Hundred Years' War. Tuchman wrote it during the Cold War, using 14th-century catastrophes as a mirror for her own era.

His point: every generation underestimates the challenges of the past (because they've already been resolved) and overestimates the challenges of the present (because they haven't). America survived a civil war, McCarthyism, the internment of Japanese Americans — and emerged each time with regret and resolve. Even in the darkest moments, there is precedent to suggest things will get better.