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The investment banks which barely survived the financial crises are back on their feet. In 2010, the total fees charged by the industry increased by almost 6% to $49.1 billion. Goldman Sachs (GS) was the third most profitable company in stock equities and bond underwriting. Last year, the company earned $3.60 billion in advisory fees. This year, earnings are expected to grow by 12.4%, and long-term consensus earnings growth is expected to be 12%. With $526.32 billion in current assets, Goldman Sachs is one of the largest institutional investors in the stock market. The investment titan offers 56 mutual funds managed by "professional" money managers. Thirty-nine of these funds invest in equity markets. Goldman Sachs' largest holdings are as below:

Stock / ETF

Value ($ million)

% of Portfolio

% Change

YTD Return

Spdr S&P 500 (SPY)

$5,345.29

3.80%

7.36%

4.05%

Microsoft (MSFT)

$2,434.50

1.73%

3.20%

-7.46%

Apple (AAPL)

$2,264.59

1.61%

21.87%

9.12%

Dollar General (DG)

$1,609.41

1.15%

-10.39%

-6.03%

Pepsico (PEP)

$1,583.29

1.13%

8.51%

-0.28%

Ishares Russell 2000 (IWM)

$1,574.55

1.12%

-29.36%

2.48%

Schlumberger (SLB)

$1,466.85

1.04%

15.18%

3.57%

JPMorgan Chase (JPM)

$1,329.08

0.95%

-2.84%

7.95%

Genzyme (GENZ)

$1,275.98

0.91%

1946.10%

6.73%

Qualcomm (QCOM)

$1,274.05

0.91%

13.50%

8.68%

Ishares MSCI EAFE Index (EFA)

$1,255.19

0.89%

-47.03%

1.92%

General Electric (GE)

$1,241.82

0.88%

24.59%

12.11%

Ishares MSCI Emerging Markets Index (EEM)

$1,240.73

0.88%

16.55%

-3.38%

Oracle (ORCL)

$1,192.37

0.85%

-9.64%

2.11%

Google (GOOG)

$1,161.49

0.83%

2.88%

-2.91%

Occidental (OXY)

$1,035.36

0.74%

-16.22%

1.12%

Bank of America (BAC)

$1,001.96

0.71%

13.25%

7.88%

Cisco (CSCO)

$984.12

0.70%

-18.32%

-11.27%

Education Management (EDMC)

$982.27

0.70%

-0.02%

3.98%

Vanguard Emerging Markets Stock ETF (VWO)

$980.36

0.70%

0.54%

-3.70%

Baxter International (BAX)

$969.01

0.69%

-16.16%

4.53%

Procter & Gamble (PG)

$955.54

0.68%

-4.75%

-3.71%

Exxon Mobil (XOM)

$922.05

0.66%

-14.72%

12.90%

Cobalt International (CIE)

$914.14

0.65%

0.00%

21.62%

Johnson & Johnson (JNJ)

$847.99

0.60%

-26.72%

-2.63%

Coca-Cola (KO)

$826.88

0.59%

76.45%

-0.75%

Costco Wholesale (COST)

$825.18

0.59%

6.06%

0.75%

Newfield Exploration (NFX)

$824.48

0.59%

-2.78%

-2.39%

Staples (SPLS)

$819.91

0.58%

-1.62%

-10.94%

Mastercard (MA)

$753.02

0.54%

30.00%

10.92%

Total / Average

$39,891.45

28.40%

2.23%

The year-to-date weighted-average performance of top 30 holdings is 2.23%, which is well below the S&P 500 return of 4.05%. JPMorgan's equity holdings performance is not much different. For individual investors, that is a strong incentive to invest in low-cost, index-tracking ETFs instead of high-cost mutual funds. Some of Goldman Sachs' mutual funds charge up to 3.66% in management expenses.

A quick snapshot of the top holdings shows that Goldman Sachs reduced 12 of its current holdings. The average year-to-date return of these 12 holdings was 1.44%. Goldman Sachs reduced Dollar General holdings by 10.39% and Cisco holdings by 18.32%. That was a wise decision; Dollar General lost 6.03%, and Cisco lost 11.27% since January.

There is one stock that the investment titan is extremely bullish about: Goldman Sachs increased Genzyme holdings by 1,946% listing it among the top 10 holdings. Genzyme is a biotechnology company that focuses on rare genetic disease disorders, renal diseases, orthopedics, cancer, transplant and immune diseases. After posting losses for three consecutive quarters, Genzyme reported $472 million profit in the last quarter. While Genzyme's balance sheet is not that impressive, analysts have insanely optimistic opinions on its future earnings. According to Zacks research, next year's expected earnings growth is 17% with a long-term consensus earnings growth rate of 22%. One might want to keep an eye on that company.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: Goldman Sachs' Top Holdings