Can you make $500 a day trading Tesla $TSLA with 5k?

hey folks today is thursday september the 10th 2020 i wanted to show you a quick trade that i like to do two or three times a week on tesla just depending on the market conditions but it's just a pure theta trade that's all it is um it's a one-day trade tesla is the last stock in the world that i would want to be holding overnight uh and having to deal with the jumps and the bumps that you get in the pre-market and the after market but it is uh just a pure theta trade it is uh an iron condor i would do a uh strangle a naked strangle um but the margin requirements are too high so we do spreads spread it on both sides it ends up being an iron condor credit iron condor and so i just wanted to show this to you here uh this is the trade i've got several positions here going on inside of tesla but the trade that i just did here this morning is right here and that is uh basically an iron condor it's a one-day iron condor but i'll take it off at the end of the day today uh regardless of what it does i may have to adjust it throughout the day here but if you look at that this is the 13 contracts here and i go into my positions this is the trade right here so if i let's come over here let's get rid of these and we can sort of look at this inside of the wrist wrap you can see a little bit what it looks like there a little bit skewed to the downside that's just simply because of my inclination that we popped a little bit on the upside here today but that it is sort of range bound and trading and if you look more specifically at the trade table you can see that basically again i'm i'm just slightly into that brown bar right there that's the expected trading range based just on implied volatility and standard deviations i'm just outside on my put leg there of the expected move and just barely inside here uh it's about a five dollar spread on these that i'm doing and this was uh i believe about a six thousand dollar trade i think i've got i got 6 500 total uh margin tied up in all of these trades but about six grand into this particular trade right here and uh the goal with that would be you know you can see that that's built a trade that has yeah almost 500 of theta in it per day um and so i'm going to come back here we're at you know 7 48 a.m mountain time markets just opened up for 20 minutes i just barely put this trade on um and so i'm gonna come back here and either look at it if a during the day i've got to do some adjustments to the trade to alter it if you know tesla starts taking off or crashing i'm gonna have to come in and adjust the trade or b hopefully b we just come back at the end of the day we're still well within the ranges and i've been able to capture a lot of this theta so my goal you know your it would be ideal obviously to make 500 on this trade today how nice to put up 6 grand and bring in 500 in a day that's ideal that's that's probably your ideal outcome just simply because there is probably going to be some movement that would imply that you get no movement in the stock and you just get all theta erosion there's probably going to be some delta moves that are going to work against that theta erosion so you know what even if i could capture two or three hundred dollars that's great for me if i can get two to three hundred dollars a trade two or three times a week on tesla like this then it ends up being a nice supplemental income from a pretty small relatively small capital allocation to that so we'll come back here either if i have to make an adjustment throughout the day or be at the close and see how this traded just a quick check in on the trade it's about 9 a.m mountain time so about an hour and a half into the trading session today actually a little bit ahead of schedule in terms of what we had hoped for um here's the uh there's the trade and how it's currently constituted i had a little bit of a push here um right up in here to that almost 400 level i was uh i think we hit what are we right there like 397 almost 398 400 was my adjustment level at 400 you know we sold the 405 calls so 400 it's gonna have to adjust this trade up and uh right at that uh 398 level we've got a little correction coming back down here now to the downside got some good selling pressure here uh coming down so the trade is pretty solid i had said earlier here um that you know we had four or five hundred dollars of potential theta on the day but obviously we're going to have some movement in this price which we have had uh which would obviously negate all of that theta so probably unrealistic to think we're gonna book a four or five hundred dollar profit on this today um but we're way ahead of schedule i i would be thrilled if we could get 200 out of the trade today and we're obviously above that now quick little correction there i did say that i had sixty five hundred dollars or six thousand dollars tied up in that trade the trade itself actually because i do have uh obviously as you can see i've got multiple uh tesla positions working here right now in addition to this particular one um so the actual trade uh right here if i replicate that trade you can see it was actually about a forty six hundred dollar trade so you know that's that's even better if i could pull in 200 bucks 300 bucks on a four or five thousand dollar trade um that's even better right so uh continuing to work that trade a little bit here uh i did get that field at a buck 58 was the credit on that trade and it's trading right now down around that 135 level so moving moving into the profit zone we'll check back here a little bit about 10 45 mountain time i'm gonna go ahead this trades progressing pretty nicely you can see that we were up i don't even remember we were up pretty substantially let me just look at the uh let's look at the nasdaq first um yeah we were up at like 1100 500 we we've sold off substantially maybe 150 point down move negative on the s p obviously as well that was up substantially as well so you can see we've got this little bit of a sell-off going on uh just in the overall market and that plays nicely into our tesla trade here um i've got a negative delta that i initiated up front anyway and so i would actually benefit from this tesla let's just take a look at it intraday see what it's doing um it's still showing some pretty decent strength actually i mean overall trend is still up but you can see that as the market has started to come down it's weighing a little bit on tesla's advance as well so uh just all in all everything is boating quite well for this tesla trade i'm going to put in it might be a fantasy it probably is overly optimistic but again if we look at this trade i got in at this i got a buck 58 credit uh on the trade put up about 4 600 i believe to do that and i would love to get out of this thing at i was looking at a buck tan a dollar 10 which again might be aggressive but a dollar ten out i'm just going to go ahead and send that order right now [Music] that would put me in the trade including commissions total cost and whatnot 44.93 would be my total all-in on the trade this would be 51.17 again including commissions this is net net this would get me out at 51 17 about a 624 uh net profit on the day probably a little aggressive uh i don't know if we're gonna get down there or not but i got it in now i got that order working um and you know we're we're not we're really not that far away from it to be honest uh uh trying to get out at a dollar ten is trading about about 25 now so we'll let this play out for a little bit longer 11 30 going into the last hour and a half of trading today getting close oh we're getting so close now uh just because we get down here to this level uh you know i'm trying to get out at a dollar ten debit we're really getting closer but just because the mid price hits a dollar ten doesn't mean we're gonna get our fill at a dollar ten i mean my goodness this thing might have to go down to a dollar or a dollar five uh to get at the mid price to get a fill there at the 110 level but we're getting there man that'd be a 624 dollar profit on the day on a 4500 investment that would be nice hour and a half left in the day unless tesla goes crazy you know hasn't really been moving much it's just kind of sitting there right at that uh 15 well up 12 bucks to 30 bucks on the day has sort of been where it's been fluctuating so we're getting close i think with another hour hour and a half of uh theta erosion here again barring some massive moves down here we might be able to get our 600 bucks on the day excuse me it's about 11 40 a.m now i'll tell you what i am going to uh i'm going to be a little greedy on this trade i had just said that uh i think trying to get out of this thing at a dollar ten debit was uh was pretty aggressive um that'd be over a 600 profit on the day and initially we were just looking to get 200 or so on the day anything above 200 would have been awesome uh and now we're shooting for 600 on the day i'm going to push that a little bit more um you know we've got a couple hours still in the trading day still a couple two hours 20 minutes left in the trading day things are progressively starting to just sort of deteriorate here in the marketplace it's not a big massive sell-off by any means but you can see that the s p 500 uh and the nasdaq are definitely negative and they've been positive both of them deposited today again not a massive sell-off here but weakness is a bounding and we're getting close to that 110 level here i'm going to go ahead and pull this cell order because i think there's a chance that i might be able to do better than 110 so i'm going to go ahead and cancel this order and let's just watch it for a little bit and see where we get it's 12 15 running into the latter part of the trading day today and we just started to get this nice set well not really nice for me but there is this sell-off that's taking place here these are five-minute bars and it's affecting my profit potential in the trade right now let's just see on looking at what an exit would be about a buck 30 is the mid price um you know and i was hoping for 110 or about buck 30 but 40 right now uh and we're getting the sell-off here and so for me my exit points probably going to be just below this v bar that uh teal line right there that you can see that's the v web and if we break down below that that's probably my signal to get out so i'm going to watch this closely if we do break below we'll book whatever profit hopefully profit is remaining in the trade and then we'll do some calculations and see where we ended up at if we can hold that and bounce back and we'll hold on for just a little bit longer all right guys real quickly here we are at 1 51 p.m nine minutes until the market closed and oh boy it's been an interesting ride we're going to do a little bit of analyses here when we do eventually close this position out here in the next few minutes and go through the numbers but across our fingers cross our fingers it should be a decent day for us i'm going to continue to hold this as long as i can maybe up to uh two or three minutes before the market closes as you can see there in the chart we are getting a little bit of a rebound here a little bit of a rebound coming back in to the close and that is what i need i need probably another three dollars to the upside to really make this trade the home run that i had hoped that it would be so we'll see where we end up here shortly all right five minutes before the close it's time and i believe i think we have uh could have been better but it could have been much worse we'll look at that here in just a minute let's go ahead and close this trade out i'm going to try to uh do the mid price of 110 here oh i've already got my closing order in yeah let's go ahead and let's change this let's place that order to maybe one 15. there's one 14. we'll see if we can get a fill i do get a fill let's see what i filled that filled right at 1 14. so there's my activity on that you can see uh there's my original trade right there brought in a credit of 158 i'm gonna make some notes on this 158 was the original credit and that was in and then i'm out at 1 14. let's see what the math looks like on that all right guys uh so there we go we're at the close and uh we did okay we did okay you can see activity wise there um again we came in at about a buck 58 got out at a buck 14 not a bad day but it could have been a little better could have been much worse and that's really i guess the conversation that we need to have so i'll just throw up some numbers here of where we're at on this we were about 44 93 uh in on the trade we got in again at a buck 58 that was our credit on the trade and then we were out uh on the trade at dollar fourteen dollar fourteen debit um obviously the difference between those two that puts us out at uh five thousand sixty five dollars okay so that's our out price uh so essentially we look at this our profit uh was five hundred seventy two dollars that's our profit 572 profit on the trade on that 44 93 initial so we're looking at about a 12 percent cash on cash return for the day guys that's in a day that's one day so interesting trade i like the trade i like the idea that you can take 4 500 bucks and make 500 on a day like that but i think there's probably uh some bigger things that need to be discussed as we look at this and let's go let's go to the chart here and we can talk about some of the things that uh i had to deal with in this trade today because it wasn't all uh peaches and cream okay and there's a couple things i think that really speak to what happens here and why sometimes the result is less important than the discipline that you use to get that result i want to talk about maybe this part of the trade right here this part of the trade right there and maybe if we look maybe more specifically down right here that part of the trade right there so couple of things that are interesting about this trade and it does come down to risk management so this number right up here that got us i think about to if i get my cursor back here let's go look at the cursor that number was about 398. this could go up in price remember we sold the 405s so this could go up to about 400 before i had to exit out before my stop loss would have kicked us out i was probably one these are five minute bar charts here candlesticks uh i was probably one take away from exiting this trade at a zero profit just hit that 398 level and then it came back down for me but i would have exited this trade right here at the four if it had ticked up again to 400 that would have put me back to a break even it would have taken me from my three or four hundred dollar profit that i was showing down to zero and i'm okay with that uh i'm okay throwing a trade on not making any money not so okay throwing a trade on and coming up really short with a big big loss right that kind of defeats the whole purpose it's not very easy to be consistently successful over the long term if you're booking loss after a loss after loss if you book no profit that's one thing if you book a loss that's another same thing happened down here you'll see that we hit the v web line right there and i thought we were good i thought we were going to hold that and we didn't we broke down below it came down here to just above 360. it was like 362 361. my exit for the down leg here was 360. so we were going to have to sell out at 360. that would still give me like maybe 20 bucks profit something like that but not really enough to matter uh but it would have gotten me out at no loss so we were probably one take away there uh so again great great day 572 profit on the day uh on a 4500 investment um but really i think the takeaway here is not the profits that we made today but the risk management i would have been willing to exit this trade right here if it would have ticked up a little bit higher i would have been willing to exit this trade right down here if it would have ticked just maybe one tick lower as well very willing to throw a trade on and get out with no profit very willing to work my butt off all day long for no reward don't want to do it for a loss though because obviously that's not something that you can consistently sustain so there's uh your trading idea for today folks on trading tesla you know the question of of the trade really is and i had this presented to me a couple times can you make a living um trading full time with five thousand dollar account now hey we made 572 dollars today on uh an account or on a trade size that was less than five thousand dollars could you do that every day could you make five six hundred dollars a day everything yeah twenty five hundred dollars a week ten thousand dollars a month could you make ten thousand dollars a month on a five thousand dollar trading account well that's what this implies right uh i'm i'm gonna say no i'm gonna say no that's probably uh i mean you could you could be a very good trader you'd be a much better trader than i am and maybe you believe that that's something that's sustainable that's not sustainable for me i know that uh not every single day am i going to have this type of potential not every single day is it going to work out you have many days where you're just going to zero out on the day you're going to hit your stop loss you're going to be out of the trade right but the only thing that we do know and again there's no guarantees in trading but one of the guarantees that we do know is that if you know strategies you know adjustments you know stop losses and risk management all you're really looking for is potential and is there potential in tesla right now with its current implied volatility is there potential in being able to make five to ten percent returns every single day can you trade five thousand dollars in tesla right now on a daily basis and have the potential to make 500 a day in profit yeah the potential is there doesn't mean you're going to do it doesn't mean you can do it but again as traders that's all we can hope for is hey can we find the potential and then of course it's up to us to structure the trade correctly and then most importantly manage the risk if and when we're wrong or the trade doesn't work so hopefully that was helpful for you guys seeing that today we'll come to you over the next couple of days with a few more trades should have a fun trade for you tomorrow on friday

Channel: Scott Stewart

Views: 2,126

Rating: 4.878788 out of 5

Keywords: Tesla, $TSLA, options, daytrading

Id: lD-NTVGeXU4

Length: 22min 41sec (1361 seconds)

Published: Thu Sep 10 2020