Tesla (NASDAQ: TSLA) shares have at all times been unstable, however traders who couldn’t abdomen the swings have typically misplaced out. The dips have been short-lived, however the peaks spectacular.

Proper now, the shares are in a trough. So, is that this a type of golden shopping for alternatives that Elon Musk’s electrical automobile (EV) firm often throws up? Or is it the top of the highway for what’s arguably essentially the most compelling inventory of the final decade?

Has Elon Musk backfired?

The Tesla share price has had a brutal 2025, crashing greater than 40% year-to-date. That’s a a lot sharper drop than the S&P 500, down simply 4.33%. 

The inventory is again to pre-‘Trump bump’ ranges, as traders fret over falling gross sales, a scarcity of latest fashions, rising competitors and Musk’s newest controversies.

Tesla has at all times been an unconventional inventory. Regardless of promoting far fewer automobiles than legacy carmakers, on 27 December Newsweek calculated its shares have been extra helpful than the 35 subsequent largest carmaking friends.

On the time, Tesla’s market cap stood at $1.46trn. At present, it’s down to $696bn.

That was partly because of the cult of Musk and largely the assumption that Tesla is greater than only a automobile firm. It’s a know-how powerhouse that can dominate the way forward for transport.

However actuality is hovering. Tesla’s newest earnings report disenchanted traders, with income lacking expectations and automobile deliveries declining. 

The corporate has needed to slash costs to remain aggressive, squeezing margins additional. And whereas Tesla nonetheless dominates the US electrical market, it’s dealing with more and more powerful competitors from conventional carmakers and cut-price Chinese language rivals.

Then there’s Musk himself. His shut ties to Donald Trump could have alienated a bit of Tesla’s probably extra liberal buyer base. That would particularly be the case in Europe as gross sales in France of Germany have plummeted round 60%.

Is that this an excellent shopping for alternative?

Buyers are additionally asking whether or not Musk is spreading himself too thinly, operating social media platform X, growing AI and capturing for the celebs with SpaceX. There’s additionally the danger that Musk and Trump may fall out sooner or later.

One factor hasn’t modified. This stays the last word high-risk, high-reward inventory. The model nonetheless has large world recognition, its know-how stays forward of many rivals, and the EV market ought to solely develop in the long term.

If an investor had taken the plunge and put £10,000 into Tesla when the market opened yesterday (Monday 10 March) they’d have woken up to an instantaneous paper lack of 15.43% at present. 

Their £10k would now be value simply £8,457, minus expenses. That’s a brutal short-term hit. In fact, being Tesla, the inventory may bounce again simply as rapidly. However what if this time is completely different?

Inevitably, Musk nonetheless believes. He says Tesla’s income can go up 1,000% in 5 years. Plus it’s greater than a automobile firm, with an enormous alternative in humanoid robots, robotaxis and different cutting-edge tech advances that outdated fools like me don’t even get.

Musk has at all times performed for the very best of stakes. Solely traders who’re keen to do the identical ought to contemplate Tesla shares at present.