I understand that there is huge market utilizing the uncertainity character of *Volatility* in the option market.What I wanted to learn more about is the trading part, and if there is a way for an individual who is not so cash rish to venture into the territory. I have the research knowledge of how options work, but how do you manage the vols to trade...and last atleast until you accumulate enough?In other words how to actually become Exotic while trading them?Are volatilities and predictions about them used widely by good traders around? Is there a market for ratings on options based upon their vols? Any comments welcome, Thanks!T

Without a lot of money to invest, you'll have trouble trading exotics. You don't have to be rich, but you need to attract other people's money to invest. Otherwise, you're pretty much stuck with vanilla exchange-traded options.You can make volatility trades with vanilla options. A simple one is to buy 100 shares of stock and two put option contracts. You make money if the stock price moves a lot in either direction, or if the market increases its opinion of how much the stock price will move in the future. You lose in the opposite cases.This kind of investing has all the risks of frequent trading in stocks, plus additional ones. I don't think you're likely to make money at it, even if you're really good retail commissions are hard to overcome. At the least, I suggest paper trading first.

if you are US based and looking into listed equity options, check interactive brokers. but i second Aaron's response to use other people's money. at the very least use money you don't care about (i.e., NOT rent/mtge money)