The problem with backspreads is that there’s also a wide loss range — between $70.70 and $100 in this case. Here, they’re collecting a 70 cent credit, which they will keep as long as it stays above $100. They will begin to lose money if it moves below $99.30 and could suffer hefty losses if it settles at $85 strike. They might be thinking that the market will either 1) hold above $100, or 2) completely fall apart by mid-March. This is kind of like buying disaster insurance, but they’re getting a credit for it. However, they also run the risk of losing money if SPY falls but doesn’t plunge.

I like backspreads in some situations, like with a biotech that might make a big move around an FDA announcement a couple of months out. I don’t love this particular trade because of the risks.