Multiple Incomes - Property And Forex Trading

Multiple income streams (or pathways as I prefer to call them) offer the possibility of developing varied interests and passions that can provide us with additional sources of revenue. I have been interested in multiple income streams for over five years, and in that time I have worked hard to develop four pathways. Here is a brief summary of my experiences of two of these pathways - property and Forex trading:

1. Property. I have a portfolio of four buy-to-let properties in the north of England. I made my purchases just before the start of the recession, so the equity I originally built up has now been lost. However, there are still bargains to be made in the property market, and with mortgage rates at their present low levels it is possible to make significant profits.

Buyers need to be aware of the unforeseen costs - at the property seminars these are never clearly explained, and as these amounts can be quite significant it is really worth being prepared. The average charge for services and ground rents on my properties works out at about £1000 ($1600) per property per year. Buyers should also be aware of, and expect, void periods when there are no tenants in place.

Property should be seen as a long term investment (in excess of 15 years), buyers should be aware of unseen costs, and incomes will vary widely depending upon changes in interest rates. At the moment mortgage rates are at an all time low and property is profitable, but any significant rise in rates will eat away at the profits, and the properties may, at best, break even.

2. Forex trading. Trading on the foreign exchange markets can be incredibly exciting, and with trillions of dollars being traded every day there are substantial profits to be made. However, for the uninitiated and inexperienced, Forex trading is the quickest way to lose everything.

To have any hope at all of being successful with trading on the money markets you need to really do your homework and become familiar with the basics - you need to know your candlesticks and stochastics, and you should be able to tell the difference between bull and bear markets!

Because there is so much money to be won (and lost) in the markets, there are many systems on offer from so-called experts. Choosing the right one is almost like finding the proverbial needle in the haystack. Some baffle you with charts and indicators, whereas others are based upon patterns that "seem to have worked in the past".

Before putting any money into Forex trading it is so important to have had a go at first with paper trading. This will enable you to try systems without the risk of losing your shirt (or blouse). The drawback with paper trading is that you can be lulled into a false sense of security because ultimately you're not going to lose anything.

Without doubt, the hardest part of trading is the mental game. Many books have been written about trader psychology, and whilst wins can be uplifting and confidence boosting, losses can be devastating. How would you cope with the mental game? Would you chase losses and compound the problem?

Forex trading is really for the professionals and those who have the time to seek out systems, trial them, improve them, and become proficient in them. The money markets can produce an excellent income, but beware the health warnings and don't dabble - in the end you will lose. In my four years of trading I have won, and I have lost. In my father's words (he was an avid follower of horse racing), "I've just broken even".

In my next article I will describe my experiences in my remaining two income pathways - small business and internet marketing.