
The First Law of Investing
There are only three ways to earn returns.
Below is an article originally written by Jan Blakeley Holman, CFP®, CIMA®, ChFC, CDFA, CFS, GFS®, Director of Advisor Education at Thornburg and published on April 21, 2021, in Thornburg's blog. Go to Thornburg's company page on PowerToFly to see their open positions and learn more.
In 2004, Congress designated April "Financial Literacy Month". In celebration of financial literacy month, this is the first of four articles that focus on the four laws of investing.
In 1650, François de la Rochefoucauld wrote that "the only thing constant in life is change." And Rochefoucauld wasn't alone. Even though it predates Monsieur de la Rochefoucauld by over 3,300 years the Code of Hammurabi (now on view at the Louvre) said the same thing. While I didn't know François, I wasn't in the room when the Code was hammered into the stone, and while I don't agree with many of the Code's controversial 282 rules, I do know that throughout the ages, many of the world's greatest thinkers have told us that, in life, change is a given.
On the surface, the same can be said of the investment process, where change and cyclicality are unrelenting. Markets go up and markets go down, economies crest and economies recede, interest rates move higher and interest rates move lower. Yet, amid all of the change in the investment world, four key principles have always remained the same. I call these the four laws of investing.
The first law of investing
There are three ways an investor earns an investment return: interest, dividends, capital gains, or a combination of the three.
Interest
Bank savings accounts, certificates of deposit (CDs) and bonds generate interest. Investors often choose these investments when they are interested in knowing exactly how much they are going to earn on some regular basis (monthly, semi-annually or annually).
Dividends
Stocks, stock mutual funds and ETFs generate dividends. Dividends are attractive to investors because they are a form of current income and offer the potential to increase in the future. At the same time, dividends are not guaranteed and in return for assuming that risk, investors hope to be rewarded with higher dividends and the expectation that the underlying investment will appreciate in price over time.
Capital Appreciation
Investors who want their investment to grow in value choose investments like stocks, stock funds and ETFs that offer capital appreciation. To benefit from an investment that has increased in value, an investor must realize the gain by selling the investment for more than the purchase price.
In addition to choosing the type of desired return, identifying the investment options that produce said desired return, and choosing the investment, investors must also choose the account in which the investment will reside.
Asset Location
Asset location refers to the place an asset (investment) is held. Asset location affects how income or gains from the investment are taxed. Because of that, in identifying the investments that have the potential to generate the type of returns they are seeking, an investor must also be strategic about where each investment will reside.
For example, let's say an investor is interested in buying shares of a company that she believes has significant appreciation potential. If she purchases the stock in a taxable account and sells it for a profit, she will receive capital gains tax treatment on that profit.
On the other hand, if an investor purchases the same stock in an IRA account, the tax-treatment will be different. Although she will still make a profit on that particular stock in her IRA account, she will not receive the favorable capital gain tax treatment she received in her taxable account. Instead, all of the distributions she takes from her IRA, that have not been previously taxed, will be included in her taxable income, and taxed as ordinary income in the year the distribution is received.
Understanding investment returns and asset location are two of the most important considerations an investor must make. Once they make those decisions, they need to understand how to take full advantage of their investment returns.
___________________________________________________________________________________________________________________Important Information
The views expressed are subject to change and do not necessarily reflect the views of Thornburg Investment Management, Inc. This information should not be relied upon as a recommendation or investment advice and is not intended to predict the performance of any investment or market.
This is not a solicitation or offer for any product or service. Nor is it a complete analysis of every material fact concerning any market, industry, or investment. Data has been obtained from sources considered reliable, but Thornburg makes no representations as to the completeness or accuracy of such information and has no obligation to provide updates or changes. Thornburg does not accept any responsibility and cannot be held liable for any person's use of or reliance on the information and opinions contained herein.
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Chainalysis’s Ashley Vaughan on Why She Finds Cybersecurity So Meaningful, and How More Women Can Find Their Niche in the Industry
How much money do criminals control today, and where is it?
These are some of the many questions that Ashley Vaughan, Senior Solutions Architect at blockchain data platform Chainalysis, spends her days working to answer.
“You learn more about a situation or problem by following the money than from any other resource or piece of information,” she explains. “Money doesn't lie. People can lie in text messages or other means, but the path of the money leads you to what you're trying to accomplish.”
Though Ashley always knew she wanted to work with computers, she found her way into roles in cybersecurity, and then specifically blockchain security, through networking and exposure — not by setting out to do so.
We sat down to talk about her career journey, as well as what advice she has for other women looking to make their mark in these burgeoning fields.
Resilience and Curiosity
Ashley doesn’t often give up, and credits some of that attitude to an obsession with soccer as a kid.
“Playing sports makes you a more resilient person, I think. You learn failure and risk, which are very applicable to my job and my career path,” she says.
That resiliency was a good thing, notes Ashley, because as a young girl, she wasn’t always encouraged to pursue what she was most interested in: math and science. A teacher early on had told her that she wasn’t good at math, and Ashley believed that narrative until high school.
“We really shouldn’t put those ideas in children’s minds, because it affects them for much longer than you might think,” she says of the experience. “But I’m the kind of person that when someone tells me I can’t do something, it makes me want to do it even more, and do it better.”
Finding out in advanced high school math classes that she actually was good at math turned into choosing a computer engineering major when she got to college.
Graduating during a recession in 2010 meant Ashley didn’t have the job market of her dreams, but after working in IT, she networked her way into a role in the cybersecurity department of a prominent DC law firm.
“They were getting hit left and right from social engineering and phishing attempts,” says Ashley. “Due to the sensitive nature of the work they dealt with, I was exposed to the darker realities of the digital era, and I began to see a new side to the world—one of real significance to national security.”
Specializing in Cybersecurity — and Finding a Home in the Private Sector
Inspired by what she was working on at the law firm, Ashley pursued a master’s in cybersecurity with a focus on counterterrorism.
“I wanted to help protect our country,” she explains. “I have a lot of family members who are former military, so that was a natural step for me.”
That led to her taking a contract role specializing in offensive security at a government agency that frequently worked with Chainalysis. After working with Chainalysis folks onsite, she was sold and started pursuing a position with the company.
“I wanted to help make sense of blockchain data for a bigger purpose, like assisting in the continued threat of ransomware activity against American interests,” she explains.
Although she credits her public sector work with providing a solid foundation in blockchain security, the private sector turned out to be a better fit for her.
“What I love about Chainalysis is that my colleagues are really happy people, and I’ve always felt welcome and not scared to ask questions,” says Ashley. “In past jobs, where I was one of five women in a group of 150, I felt a lot of pressure. I didn’t ever want to make a mistake. I felt as if I had to be a chameleon to match the social environment of my male counterparts.”
Blockchains are all about democratizing data, and Ashley likes working with a team of people of all backgrounds to help support that mission. At Chainalysis, Ashley works with internal product and engineering to show customers how Chainalysis data can help them use complex blockchain solutions to solve data problems — and catch bad guys.
“Sometimes we’re following a bad actor who’s tied to child sex trafficking. Being part of a coordinated operation to put a stop to things like that is really fulfilling,” she says.
3 Tips for Women Who Want to Find Their Place in Cybersecurity
For a long time, reflects Ashley, she just wanted to come into work, do her job, and feel supported, without feeling like she didn’t fit in or was representing her entire gender. Fortunately, she found what she wanted — and she hopes other women will find that, too. They can start their search by:
- Knowing they’re not alone in having tough experiences. “Everyone has different definitions for how you’re supposed to act or supposed to handle your emotions as a woman at work, and it’s exhausting. It’s like, ‘This is just me.’ I can’t repeat enough how tiring that is,” she says.
- Prioritizing self-directed learning. Although Ashley completed a master’s in cybersecurity, she emphasizes that there are many other routes into the industry, including self-study. Whether you get involved in programs like Girls Who Code or do self-paced learning through platforms like Udemy or Coursera, the important thing is that you pursue independent learning about topics that interest you, she says.
- Creating and maintaining relationships. “Really talking to people is almost a lost art,” says Ashley. “Getting together with someone who has the same sort of mindset and leveraging their knowledge, and making sure you keep in touch with people who help further your career, is a good move. Most of the places I got to professionally were based on my human connections.”
Nowadays at Chainalysis, Ashley is no longer one of five women in the office, and is excited to start paying it forward so that more people with backgrounds like hers can pursue their own professional success.
“We tend to feel more comfortable talking to people who might have our same gender or educational background, and being open and vulnerable with them,” she says. “Being a visible role model is really important to me.”
Check out Chainalysis’ open roles here!
Careers in Web Development: Which One's For You?
We all have our favorite websites– the ones we frequent, bookmark, and recommend to others. You might even enjoy some website features so much that you’ve found yourself wondering why they aren’t more popular. Or maybe you’ve experienced times where you were frustrated with a website and wished you could add features or even design your own!
If you’ve ever found yourself intrigued at the prospect of designing and developing your own websites, then a career as a web developer might be just for you!
As a web developer you would be responsible for coding, designing, optimizing, and maintaining websites. Today, there are over 1.7 billion websites in the world and, in turn, the demand for web developers is on the rise. In order to figure out what kind of web development work best suits you let’s start with an introduction to the three main roles in web development that you can choose from.
The Three Types of Web Development Jobs
Front-End Web Development: The Creative Side
Think of front-end development as the décor of a house. The color scheme, furniture, manicured lawns, and overall aesthetic. In terms of a website, front-end development is laser-focused on the appearance of a website and its presentation on different devices. If you’re considering a role in front-end development, it’s important to learn programming languages such as HTML, CSS, and JavaScript. These three languages go hand-in-hand. HTML allows you to create user interface elements, CSS helps you with stylistic elements, and JavaScript allows you to incorporate online tools and connect your website to back-end functions.
In addition to programming skills, front-end developers need to be detail oriented, creative, willing to keep up with the latest trends in web development, cyber security conscious, and geared toward user-friendly designs. The median salary for a front-end developer can reach well into the $90,000 to $100,000 range.
Back-End Web Development: The Logical Counterpart
While a house can be beautifully decorated, it’s incomplete without a solid foundation and efficient infrastructure. Similarly, a well-designed website depends on logical and functional code to power the features of that website. Back-end web development is code-heavy and focused on the specifics of how a website works. If you enjoy the analytical challenge of creating the behind-the-scenes code that powers a website, then back-end development is for you.
Since this role is more code-heavy, it’s important that you learn numerous programming languages and understand algorithms and data structures. Some languages that are essential to back-end development are Ruby, Python, SQL, and JavaScript. Back-end developers also ensure that users can successfully retrieve and access data. This requires creating and using APIs (Application Programming Interfaces) which act as messengers that relay data related requests. Additionally, developing the code for the inner workings of a website also requires back-end developers to be conscious of the user interface features designed by front-end developers and to internally mitigate potential security risks. Due to the increased technical aspect of this position, back-end developers normally earn higher salaries than front-end developers. The average median salary for this role is around $118,000 per year.
Full-Stack Web Development: A Little Bit of Everything
A full-stack developer is essentially the Jack (or Jill)-of-all-trades in web development. Full-stack developers need to be knowledgeable about both front-end and back-end roles. This does not necessarily imply that you would need to be an expert in both roles, but you should fully understand the different applications and synergies they each imply. In order to work in this position, you will need to know the programming languages used by front-end and back-end developers. In addition to these languages, full-stack developers also specialize in databases, storage, HTTP, REST, and web architecture.
Full-stack developers are often required to act as liaisons between front-end and back-end developers. Full-stack developers need to be both problem solvers and great communicators. The end goal for a full-stack developer is to ensure that the user’s experience is seamless, both on the front-end and on the back-end. In return, you can expect to earn a median salary of $100,000 – $115,000 a year for this role.
Taking the Next Step
Web development is both in-demand and lucrative! All three roles described above contribute to specific aspects of web development and the scope of each one can be customized to the industries and positions you feel best suit you. Regardless of which role you choose, all of them need a foundation in programming.
To gain the programming skills needed in each role, you can enroll in courses or learn independently. Coding bootcamps are a great way to boost your skillset quickly and efficiently.
Click here for some of our highly rated programming bootcamp options! Make sure to check out the discounts available to PowerToFly members.
What Are You Passionate About? Answer Interview Questions Effectively And Succeed!
💎 “What are you passionate about?” In an interview, you may have to answer this and other personal questions. Watch the video to the end to succeed in your job interview at Ribbon.
📼If asked “what are you passionate about?” in an interview you need to show how your passion can make you a good candidate for a job position. Ryan Key, Talent Partner at Ribbon, shares some tips and tricks for you to stand out!
📼Answering what are you passionate about in an interview is not the only thing you need to know how to do to succeed. You should try to make sure that you express your experience in a way that shows your interest in Ribbon’s mission. Also, prove that you did your research and demonstrate to the recruiter that you understand exactly how your role affects Ribbon’s purposes. Don’t forget to share some ideas on how you intend to fulfill the company’s mission!
📼 You are asked what are you passionate about in an interview, but this doesn’t mean that you can’t ask as well. You should feel empowered to ask any question you want during your interview process. It may be helpful to save certain questions for certain people. If you're in an interview with your potential manager, you should take that time to ask about their assessment metrics for the role and their management style. If you're speaking with a potential peer, this would be a great time to ask about their experience during training and to learn a little more about the team and culture.
What Are You Passionate About? Show In Your Interview That You Are Aligned With Ribbon's Values
The mission at Ribbon is to make homeownership achievable for everyone, especially communities traditionally left out of the homeownership story. One way Ribbon addresses diversity, equity, and inclusion in the workplace is through its support of employee resource groups. Remember to show that your passion is aligned with these core values!
🧑💼 Are you interested in joining Ribbon? They have open positions! To learn more, click here.
Get to Know Ryan Key
If you are interested in a career at Ribbon, you can connect with Ryan Key on LinkedIn. Don’t forget to mention this video!
More About Ribbon
Ribbon is a first-of-its-kind real estate technology company transforming the real estate transaction by delivering certainty, transparency, and joy to the home buying process. Consumers and realtors deserve a better experience, and they have designed an open platform that welcomes everyone in the ecosystem to participate.
Want To Build Partnerships In Remote Environments? Follow These Tips!
💎 Partnerships in remote environments is one of the most important aspects to construct in a company. Watch the video to the end to get good tips on how to do it successfully.
📼Wondering how to create partnerships in remote environments? Play this video to get three top tips that will help you to achieve it. You'll hear from Olga Shvets, HR Business Partner, and Viktoriia Litvinchuk, People Team Operations at Unstoppable Domains, who will explain the essentials of this process.
📼How to build partnerships in remote environments? Tip #1: Communicate Effectively. Communication is the key to enabling your remote team to be successful. Choose the channel that works best. For this, chat with your employees and see what they use to communicate, that's how you find the best solution. Also, make sure your team is on board with your internal tools and they know what, how, and where they need to use them.
📼A requisite for building partnerships in remote environments is Tip #2: Show appreciation. Appreciation is shown through your actions. Let your employees know that you value everything they do for the company. Create a special gratitude channel where everyone can share their appreciation for their colleagues for some contribution. Celebrate some wins, promotions, and everything that is important for the company. If you appreciate the employees, employees do the same for the company.
Create Partnerships In Remote Environments Using Trust - Tip #3: Give Honest Feedback
Use engagement surveys! They are a quick and effective way to receive honest feedback from your team and you can see what's working well and what needs to be improved. Your main priority is to create spaces where managers and employees can share honest, relevant feedback.
📨 Are you interested in joining Unstoppable Domains? They have open positions! To learn more, click here.
Get to Know Olga Shvets
If you are interested in a career at Unstoppable Domains, you can connect with Olga on LinkedIn. Don’t forget to mention this video!
More About Unstoppable Domains
Unstoppable Domains is bringing user-controlled identity to 3 billion+ internet users by issuing domain names on the blockchain. These domains allow users to replace cryptocurrency addresses with human-readable names, host decentralized websites, and much more.
By selling these domains direct to consumers for a one-time fee, the company is making a product that will change cryptocurrency and shape the future of the decentralized web by providing users control over their identity and data.