Pricing Reality Checks: An Example

Yesterday, I suggested comparing other projections to the ones you're using to determine if your prices are realistic or not. Gypsy Soul asked for some clarification.

I am not sure I understand what you mean when you say-A more useful method than finding prices you like is taking other projections, plugging in the Patton $ values, and seeing how they compare to the Patton projections from a valuation standpoint. If you see projections that are higher than Patton's in two or more instances, then you might want to push your price up if you like the player and think Patton is all wet.

Do you mean compare Patton's 2010 projections of the stats of a player with stats by other prognosticators? For example, compare with CHONE's stats? Then price up or down based on the differences in the stats?

Since the 2010 Patton projections are still on the market, I'll use an example from 2009 instead.

Entering 2009, the Patton software projected a 29/107/2/.325 line for Magglio Ordonez in 550 AB. According to the Patton prices, this made him worth $33. The AP bid limit for Ordonez in 4x4 was $29.

CBS Sports' had Ordonez at 22/105/0/.312 in 554 AB. Using the same Patton formula (not the CBS formula), Ordonez was projected to earn $27.

Fanball had Ordonez with a 22/94/2/.315 line in 581 AB. Using the Patton formula, this was worth $28. (Using Fanball's values, they had Ordonez earning $23 with a bid of $25).

Both rival projection systems had Ordonez earning $5 or less than the Patton projection. This made me think that the Patton projection was robust. Should I push Ordonez down?

He earned $27 in 2008 and $42 in 2007, so he certainly was capable of earning somewhere in the middle. However, 35 year old players typically don't bounce up but stay flat or bounce down. That made me inclined to push down his price a little. I looked at the Patton bid limit, glanced again at the Fanball/CBS projections, and pushed Ordonez down $2, to a $27 bid limit. My hunch was that Ordonez was going to decline somewhat, but a $29 raw bid on Ordonez would have pushed him to $35 with inflation. I didn't want to pay $35 for a player who I suspected was going to continue to decline and earn in the low $20s.

As it turned out, my hunch was right but way too conservative. Ordonez dropped all the way down to $15 in 2009. Fortunately, another owner pushed Ordonez all the way up to $32, which was $1 off of my inflation price. I decided I didn't want to pay par for Magglio and waved goodbye.

I don't recommend doing this for all 276 or 299 players in your auction pool. If you see a price in your software that you like, leave it alone. The gut check is only for players where you suspect the price might be too high or too low. In Mags' case, my gut told he would continue to decline and that I didn't want to pay for a rebound season. Even though I should have pushed Ordonez's price down much further, my relative conservatism kept me from pushing him to $33 and winding up with a huge bust.