Suppose I want to buy/sell an equity option expiring in six months. To compare implied vol with historical vol I should be looking 6 month historical vol? If not what is the best way to compare six month IV vol ? help will be appreciated.
It depends on exactly do you mean when you say "6 month historical vol" and what you want to do with it. You want to match the tenors, so you would do 6 months of vol (usually rolling) over the history you want to look at (1Y, 2Y, etc) if you want to compare implied vs historical over a period of time. If you just want to see implied vs realized (current), just compare it to the last 6 months of history.
Free membership at Ivolatility. Then you can look at the pretty colored comparison graphs of IV vs. HV (up tp 1 year): http://www.ivolatility.com/options.j?ticker=ISRG:NASDAQ&R=1
The best way to do this is build a normalized volatility surface (see attached.) These surfaces are fairly stable over time. This means you can compare the current six month IV with the surface IV with six months until expiration. If the two are different enough (that depends on your risk tolerance), then you can either initiate a long or short position in the option. Reference the work of Robert Tompkins.
Personally, I wouldn't look at any data six months ago. There is no indication it will be the same in the future. If you trusted anything in the past in September 08, you were kidding yourself. A better option is to develop a trading plan which is flexible and moves with the market.