Sorry this is a very noob question so please bear with me. If I know for sure the price is going to either go up or down tomorrow due to some event, what strategies can I potentially employ to capture a gain on the volatility? Do I place 2 orders: one to buy and one to sell, or would that just cancel out any profit/loss on the trade?
The most common way to trade volatility is via options. With options one can trade the volatility of any underlying instrument (ie. of any stock or index, of course regarded the underlying has options), but there are also some special volatility options without an underlying, like the ^VIX (or VIX). Here's an intro into volatility trading: https://www.tradestation.com/educat...statistical-and-implied-volatility-in-trading You don't need necessarily to place 2 orders, it works also with just one Call or Put order, if you can forecast the direction of the volatility. You can also short them to get an immediate credit; but as usual: shorting can be risky as one can lose more than what is on the stake. (Beware: when shorting options then one must generally also reverse the usual function of volatility...) I'm currently researching/learning volatility forecasting and volatility trading myself.