Housing starts and building permits will be released tomorrow, with starts in April expected to rise nearly 2.0% to an annual rate of 520,000. Building permits, the more forward-looking indicator, are expected to rise 2.7% to an
annual rate of 530,000. The two data series have been somewhat volatile on a month-to-month basis, influenced by large swings in multi-family starts and weather. While March housing starts fell 10.8%, the more relevant single-family start number rose 0.6% in February and was flat in March.
SRS is currently trading at 21.55. I recoomend writing June strike 18 at 4.80/contract for an intrinsic time value of 1.25/contract. Not on the premium is a good return on the ratio of capital invested, but also a good hedge to further downside.