SubscribeBrilliant observation, huh? People pay more money for good players than bad ones. How long did it take me to realize that? Actually, that’s not what I’m talking about here.
It’s clear that people pay more for top-tier players than for lesser players. However, it’s not immediately obvious why the Price Guide tends to understate what people tend to pay for the top-tier players. Why do people spend more for top players than what the Price Guide recommends?
As quick as I am to defend the Price Guide’s methodology, this is one case where I think people’s behavior might be more accurate. I don’t think my methodology is flawed, I just think it’s leaving out a couple of factors that come in to play in a draft:
Sleeper Mentality
Fantasy players tend to pay less for low-end “consistency picks,” and instead target late-round high-risk/reward sleepers. By targeting sleepers late, they are able to spend more money early.
So instead of spending $6 on a veteran platoon-OF or a journeyman SP, most teams will go after a rookie player valued at -$2, knowing that he has the potential to beat that projection. If he doesn’t, that’s OK, because there’s no problem with dropping him when someone better comes along during the season.
Divergent Opinions
Fantasy players tend to have more divergent opinions about late round players, which means these players go cheaper. Guys that the Price Guide projects for $6 will often go for $2-3, because there will be some owners who have them ranked below replacement level.
The top-tier guys are more predictable–everyone has a very similar ranking for the top ten players. Owners will take their savings from the late-round players and spend the money at the top instead.
Open Positions
Related to that, owners may be willing to spend money on late-round guys, but can’t because they have already filled a certain position. Compare that to the first few bids, when every team has money and open positions. The opening bids are also where the top-tier players are usually brought up.
Add all of those factors up, and I think it enough to maybe skew the values to give an extra 10-15% to the top players. And while that may work as a rule of thumb, I’d really like to be able to quantify some of these factors into the Price Guide.
Related posts:
I plan on overpaying for top players because I expect some free agents and/or $1 pickups to be available as the season progresses. And it makes sense to me to drop a $1 player or a replacement player to pick up, say, a $10 (value) player in May, rather than dropping a $9 purchased player to open up the spot.
@Mike: I agree, and that’s one of the advantages that falls under the “Sleeper Mentality” above. I wrote about that idea more here:
http://www.lastplayerpicked.com/does-10-10-10-30-part-ii/
Which still leaves the question: Is there any way to account for this when generating dollar values?
One experiment I tried in my spreadsheet is raising the replacement level. The issue is, you don’t end up with the right number of players being over $1. The positive is, it gives you a better idea of how you will actually be replacing those bottom tier players throughout the season.
Obviously the premium is going to depend on how high you set the bar. In the sample I did, I raised the replacement level by 2 pts. This created $values right in line with the old way that I allocated the superstar premium. It moved Hanley from $46 to $68, whereas the old style had him at $63. The break even point for players that got the premium in the old style was $40. The breakeven point for players without the premium was $20. This method is suggesting that any player that comes out under $20 should not be paid full price. The $1 line was ~$7.50.
If I were to really implement this in my strategy for this year, I would probably set the bar at 1.5 for hitters and 2.5 for pitchers.