Defining the Factors that Impact Player Prices in Ottoneu

I talk a decent amount about inflation. It comes up in my rankings intro, I have discussed in on the Keep or Kut podcast, and it is a regular topic of debate in the Ottoneu Slack community. But that is hardly the only thing that impacts player prices and it is not the only factor I consider when preparing for an auction.

There are eight factors that impact the price I expect to pay and will pay for a player at auction, and I want to define and explain those today. They can be broadly broken into three categories: Player Factors, Team Factors, and Market Factors.

Player Factors

Player Expected Production – This is the largest chunk of what determines a player’s value and is, quite simply the production I expect to get from the player moving forward. I am purposely choosing the word “Expected” vs. “Projected” production because I want to distinguish between projections like Steamer, ZiPS, ATC, THE BAT, etc. and other methods or estimating a player’s production. I primarily use projections for this purpose, but some things might make me increase or decrease my expected production for a player relative to his projections. The important thing for now is that the main factor that goes into player value is what you expect that player to produce.

Player Potential – This is where prospects and injured players get Ottoneu value. I do not think Shane McClanahan will have an expected production this year, but I do expect him to have production in future years. Same goes for Walter Jenkins. Differently, I do expect value this year from Junior Caminero, Kyle Manzardo, and Drew Gilbert, but I expect more production from them in the future. And that impacts how I value them.

Team Factors

Team Expectations – Is my team going to win this year? Is my team so good that I can compete no matter what else I add? Or so bad that I can’t compete no matter what? Is my team right on the border where the right acqusitions might be game changers? The answers to these questions may impact how I think about the price a player is worth to me. If my team is stacked, ready to win, but needs another top-tier bat, my willingness to pay for or trade for Aaron Judge is higher than if my team is already a very heavy favorite or not at all in a position to win.

Roster Considerations – Do I have a deep MI and a shallow OF? Did I keep Juan Soto and Ronald Acuña Jr., and Rafael Devers but not enough useful SP? Again these questions impact what I will pay for a player at auction or via trade (or as a keeper). Whether or not José Ramirez is a $50 keeper or auction target is in part a question of how I expect José Ramirez to perform, but it is also a question of who else I have to play 3B and util and how he fits my roster.

Market Factors

Inflation – Finally we get to inflation! Inflation in fantasy keeper leagues is a measure of how much more or less players will cost at auction as a result to the excess money available (or unavailable) after keepers are locked. When getting started, before any players have been rostered, each league has $4800 to spend and 480 roster spots to fill. There is a theoretical set of 480 players who are the “right” 480 players to roster and those players are worth, in total, the $4800 that will be spent on them.

Going into a second-year auction, this is still all true – the league still has $4800 to spend and 480 spots to fill and there are still a theoretical 480 players who are the best ones to roster and they are still worth $4800 total. But some of those players have been kept. In theory, the only players kept are those who are worth more than they cost. That means that if teams keep 360 total players for $3000 total, those players might be worth $3600. The remaining player pool is 120 players worth $1200, but teams have $1800 to spend on those 120 players. Regardless of any other factors – the team and player factors above, the other market factors below – each of those 120 players will cost more (in fact, they are worth more) simply because the market has more money to spend on them.

That is inflation. Inflation is not what happens because managers in a league prefer paying up for star players rather than building balanced rosters (see: league dynamics below). Inflation is not what happens when there is only one ace-level SP available so everyone wants that player (see: scarcity below). Inflation is not what happens when the last good OF is nominated and there are still three teams that need an OF (see: auction dynamics below). Inflation is simply the increase or decrease in average player price you can expect as a result of the relationship between amount of money spent on keepers and the amount of value those keepers represent.

League Dynamics – This may feel like a bit of a catch-all, but it’s basically the things that vary league-to-league that can impact player costs and therefore player value. Some leagues are far more aggressive about making trades in-season while others can be pretty quiet. Some leagues have teams that save money for in-season auctions or who are willing to cut star players to free up cash; others don’t. And these dynamics can change how I think about player values. An active trading league, I would rather go into the season with a lineup full of studs, even if it has a couple of holes and very little depth. A league that doesn’t trade much, I want to have a full, deep roster of solidly productive players, even if I lack elite stars.

Scarcity – Scarcity can come up across two dimensions: position and production. If someone cut Francisco Lindor and the next-best SS available is Ezequiel Tovar, the market for Lindor is going to be very strong. He might be a $30 player based only on production in a league with 30% inflation, but $39 likely won’t get it done. There will be at least a couple of teams in need of SS help willing to break the bank to add him. Same can happen if the market is thin at any others spot.

This can also happen if there isn’t much elite production available. If there are plenty of strong OF available, but Juan Soto is the only player worth spending $50+ on, his price will get pushed up higher than you might expect. Teams with money to spend might have alternative options at OF, but they all know that if they don’t go get Soto, they won’t get a star at all.

Auction Dynamics – Every auction is different, not just because leagues are different (though that is part of it) but because things like the order in which players are nominated can have a big impact on prices. If you took two leagues, with the same managers, all the same players kept at all the same prices, you would not get two matching sets of auction results. If there are 3-4 middle infielders that all teams covet, the order in which they are nominated can impact their prices. So can the order of players at different positions. I often go into a draft thinking I need one star-level bat at one of two positions. Depending on the order star players come out, how others are bidding, etc., I might end up with a $45 Jose Ramirez and a need to spend on mid-tier OF or a $45 Fernando Tatis Jr. and a need to find a less expensive 3B. Beyond this, you get things like runs on a position re-setting the market, managers going on tilt after a set of frustrating losses, etc. Managers will even make bids out of frustration, or to take revenge on someone who outbid them. People will make bids they don’t expect to win.

An Example

Imagine a league where I know I need an ace-level SP and I am trying to figure out my max bid on Gerrit Cole. I start by looking at what I expect him to produce, and determine he is a $40 SP in that format. I next look at his future production and determine that while he is a safe bet for the future, he isn’t likely to gain value, so I don’t want to boost his value based on the future.

Next, I look at my team. Maybe I determine my team is a contender, but only if I can add the ace I need. I also look at the rest of my roster and determine I need some OF depth and another MI, but they aren’t my priorities. I have 12 spots open and $100 to spend. With those team dynamics in mind, I might boost Cole to a $50 value for my team, based on what he means to my roster and my lack of other high-cost needs.

After that, I look at inflation and determine league inflation is about 25%, which means that other managers who view Cole as a $40 SP are going to have $50 to spend on him, and another manager who views him as a $50 value for their team might have $63 to spend on him.

I also take note of other SP out there. Yoshitomo Yamamoto will be available. Maybe Corbin Burnes was cut as well. I might prefer Cole and keep him atop my list, but the alternative options are out there and I know that if another manager wants to go over $60 for Cole, I can pivot, so I set my value for him at $55. Meanwhile, I determine I would spend $40 on Yamamoto or Burnes.

Now the auction starts. Yamamoto is nominated first and I am in the bidding up to $40, but other managers are willing to spend more, so he goes for $46. I notice at that time that two managers were bidding at the end and assume the one who stalled at $45 is likely in on Cole, Burnes, or both.

Next comes Cole and the bidding is wild. I make a $55 bid but that isn’t enough. However, I have updated my value on him after Yamamoto went. My options are getting more limited, and with fewer alternatives, Cole is more of a priority. So I am willing to go up to $58, but another manager bids $59 and I am out.

Now I know Burnes is my last shot. He was my third choice of the three, but at this point, that doesn’t matter. My choice isn’t Burnes or another ace – it is Burnes or no ace at all. As a result, I determine I am willing to pay $60 for Burnes. He gets nominated and I end up buying him for $48. That’s 20% more than the value I had for him going into the auction, but a sizable discount on what I was willing to pay by the time he was nominated.

So if you stuck with me through all of this – what did I miss? What other factors impact player prices?