Building a second income from the stock market is one of the most powerful things an investor can do with their spare capital. And the London Stock Exchange is genuinely one of the best places in the world to do it.

But with the FTSE 100 trading near all-time highs, the index as a whole is only yielding around 3.1% today. That means £10,000 inside a Stocks and Shares ISA invested in a simple index tracker would generate just £310 a year in passive income.

That’s certainly nothing to scoff at. But with savings accounts offering similar yields at much lower risk, it’s hardly an exciting prospect.

However, for stock pickers willing to dig a little deeper, a portfolio could go on to earn considerably more.

What can stock pickers earn instead?

Take LondonMetric Property (LSE:LMP) as a compelling example to consider. With a current dividend yield of 6.6%, that same £10,000 investment would generate £660 a year in passive income – more than double the index.

Crucially, this isn’t a yield built on shaky foundations. LondonMetric’s a specialist FTSE 100 real estate investment trust (REIT) focused on logistics, convenience retail, and healthcare properties.

Think last-mile delivery warehouses, supermarkets, and primary healthcare centres – the kind of essential real estate that keeps generating rental income regardless of the economic cycle.

What’s more, the business has built a portfolio of long-duration leases with built-in annual rent increases, typically linked to inflation. That means the income doesn’t just sit still. It grows year after year, compounding alongside the portfolio.

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What are the risks and rewards?

LondonMetric’s growth potential is rooted in structural tailwinds. The relentless growth of e-commerce continues to drive demand for last-mile logistics space, while the ageing UK population is creating sustained demand for healthcare properties.

While warehouses dominate its portfolio, LondonMetric is well-positioned in both.

There’s also a strong track record to point to. The company’s grown its dividend every year since 2014, demonstrating management’s ability to continuously execute for over a decade.

That said, this is still a property business with meaningful debt on its balance sheet.

If interest rates end up staying higher for longer, it would drive up the group’s refinancing costs, squeezing free cash flow in the process. What’s more, if this higher rate environment is paired with a slowdown in demand, the simultaneous occupancy drop could put material pressure on rental cash flows and, in turn, dividends.

For income-focused investors, these risks feel manageable given the essential nature of LondonMetric’s assets and the quality of its tenant base. But they’re worth understanding before investing.

The bottom line

A £10,000 ISA can work considerably harder than a simple index tracker suggests. And with a 6.6% yield, a growing dividend, and exposure to some of the most structurally resilient property sectors in the UK, LondonMetric looks like a second income opportunity genuinely worthy of a closer look.

That’s why I’ve already added this stock to my passive income portfolio. And it’s not the only income opportunity I’ve spotted this week.