Saturday, March 10, 2012

Calculating Bids: What You Shouldn't Do

Yesterday, I shared my valuation formulas for 2011 earnings in Rotisserie-style formats. Rob asked:
Can this be used to calculate auction values for this year? Or is this specific for the 2011 environment?
Each year's auction values are specific to that year's environment. However, you can use 2011 dollar values as a baseline for what you think a player might earn in 2012.

But you shouldn't simply take last year's dollar values or formulas and assume that they're gospel.

At one extreme, if you use a projection system to calculate values, you'll find that they err on the side of extreme caution for the best players. ZIPS is one of the more renowned projection models out there. It says that Albert Pujols will earn the most money in A.L.-only Rotisserie formats this year. His 37/100/11/99/.302 would have been worth $33 in last year's formula. Miguel Cabrera is the only other A.L.-only player who would have earned $30 or more (ZIPS's projected stat line says that Cabrera will have a $30 season on the nose).

While it is correct for a statistical projection model not to go overboard and promise $40 seasons for everyone, there were 11 $30+ hitting seasons in the American League and 13 $30+ seasons in the National League in 2011. If you are as conservative with your bids is ZIPS is with its projections, you will wind up with a team full of mid-level players or young players who haven't earned yet.

On the other side of the spectrum, you can't use last year's dollar values to project earnings because the formulas assume auction populations from 2011. As an example, the N.L. hitting population earned $2,763 last year. However, the 182 most commonly purchased hitters at auction earned $2,275. Players like Ryan Roberts, Jason Bourgeois and John Mayberry Jr. aren't assumed in the valuation formula but they are assigned a dollar value. If you took the best 182 hitters in the National League from 2011, they earned $2,607, not $2,275. You would need to shave quite a few dollars off in order to get to where you need to be with your bid limits.

So, again, last year's earnings and valuation formulas are a useful jumping off point to determine what a player will earn this year. But they're just that: a starting point, not a destination.

1 comment:

Rob said...

I'm going to use some combination of auction price based on projections, bids from LABR and past history from this league. I've been in the league four years and looking at past auctions, I've noticed that there are a few players that have been consistently bought several dollars below pre-season bid price. Erick Aybar, here I come...