Tired of Market Volatility? Buffett’s 90/10 Rule Helps Keep You Calm

Financial headlines have been jarring this year. Stocks in the world’s largest companies have repeatedly experienced significant swings. Experts warn of an artificial intelligence (AI) stock bubble ready to burst. Your portfolio can feel like it’s on a roller coaster. You worry that your portfolio could plunge with the next market gyration.

But Buffett’s 90/10 rule can be your motion sickness pill in the stock market’s next wild ride. This simple strategy calls for investing 90% of your portfolio in low-cost index funds and 10% in Treasurys. Buffett’s approach can help keep you focused on the smoother long game—not the short-term swings that will then become other people’s problem.

What Is the 90/10 Strategy?

Buffett first shared his 90/10 investing rule in a 2013 letter to Berkshire Hathaway Inc. (BRK.A, BRK.B) shareholders. His advice: put 90% of your money in a low-cost S&P 500 index fund (like VOO) and 10% in short-term U.S. Treasurys. This isn’t just advice for others: “My money . . . is where my mouth is,” Buffett wrote. “What I advise here is essentially identical to certain instructions I’ve laid out in my will.”

By trusting in the long-term growth of the stock market while keeping a small safety cushion in bonds, the 90/10 approach aims to capture decades of compounding—the way returns beget ever higher returns in a snowball effect—without the high fees or emotional stress of constant trading.

The strategy is more aggressive than a traditional 60/40 portfolio, but intentionally simple. The formula accomplishes more by encouraging investors to do less. It urges investors to not try to time the market. Do not buy more Nvidia (NVDA) stock right before the chipmaker’s next earnings report. Do not bet your retirement nest egg on whether some tech company beats analyst estimates.

Instead, with the 90/10 strategy you own small slices of the 500 major American companies that make up the S&P index, from tech giants to healthcare firms to consumer staples. When one stock craters, 499 others can cushion the blow. When others are panic selling, your portfolio over the long term customarily barely notices because it’s not playing that game.

The 90/10 Rule for the Mid-2020’s Wild Market Ride

Wall Street is experiencing record-breaking swings in its biggest stocks, causing significant stress for investors. There have been 119 one-day swings of $100 billion or more in the value of stocks like Oracle (ORCL) in 2025—a record and almost four times the number during the 2022 bear market.

These “fragility events,” as Bank of America analysts call them, are fueled by such factors as fast-moving traders, short-term options bets, and highly leveraged funds tied to Big Tech names like Nvidia, Alphabet (GOOG), and Tesla (TSLA). For everyday investors, the 90/10 rule means you don’t have to worry or even know about these technical market issues causing the market to sink or soar within hours—often for reasons that have little to do with the company fundamentals prized by Buffett when buying stocks.

That’s where Buffett’s 90/10 rule earns its keep. Instead of chasing headlines or trying to time the next swing, it keeps you focused on what in that past has consistently worked: time in the market, not timing the market. With 90% in a broad index and 10% in safe Treasurys, you’re automatically diversified among different assets and less exposed when the market convulses.