I Tried To Outsmart The Market … And Failed

This past Sunday, I participated in the first-ever 12-team mixed LABR auction. I have a whole Process on how to create auction values, though one input that was missing for my analysis was any historical league context. While I’ve competed against some of the other owners, there was no league or ownership history like the other LABR leagues to incorporate. Here is how I approached the league and where I failed to take the market into account and rostered a subpar, unbalanced team.

Just so everyone knows, it’s a 12-team standard (AVG) mixed league with 14 hitters and nine pitchers with five reserves (which dropped from six mid-draft). We have $100 FAAB with $1 minimum bids and any player (besides minor leaguers or players on the IL) picked up must be started that week. After that week, they can move freely to and from the reserve list. Also, there are unlimited IL slots.

With these rules, I decided on the following:

  • I wasn’t going to be afraid of hurt players because I could IL all of them.
  • Since the maximum number of pickups was 100, and fewer because FAAB bids will greater than $1, I couldn’t stream as much as I’d like in a “normal” 12-team league. I decided to focus on getting a good weekly base in hitting allowing me to stream starters. Also, I didn’t want to go after closers in the season, so I wanted a base to start with a few options.
  • To limit the need to FAAB hitters, I focused on positional flexibility and reserve a couple of options. I just wanted a couple of hitters to maximize the starters.
  • I wanted to add value even if the categories got out of whack. I can always try to trade for balance later.
  • I was going to nominate Utility Only right away. I thought they might be values (they weren’t) and I wanted to know immediately if I needed to work my roster around them. Otherwise, I wanted to nominate players in unbid pools to get an idea of the overall split.
  • Even though there was some pre-auction talk with Alex Fast about me taking Byron Buxton, I had planned on taking him. During several of my buy-in leagues, he was the top player on my list but I didn’t pull the trigger. With the IL slots and no money on the line, it was a perfect league to gamble on him in.

Without any historic league actions, I used the 2019 NFBC Online Champion standings to build my auctions values. In my book, I have the Standings Gain Points (SGP) formula for 12-team leagues. I applied it to my projections and then added a catcher bump to get their values up to $1. Then, I subtracted the replacement level players’ SGP from the pitcher and hitter groups. At that point, I had a pool of SGP that the hitters and pitchers should provide. The split was 68% hitter and 32% pitchers. The split passed the idiot check since I’ve seen the hitter potion between 63% and 70% in other auctions. With this natural split, I created my projections.

For the next step, I took the current NFBC ADP from their 12-team leagues, converted the ADP to auction values, and then put the values next to mine in the hope of spotting potential values. Immediately, I saw that while my hitters sort of lined up fine, the starting pitchers didn’t. The split was 64%/36% which doesn’t seem like much but it worked out to $125. With only 108 pitchers being picked, each pitcher, on average, was going to get a $1 added to them. Actions don’t work that way and the top players get the surplus. I didn’t know how the split was going to go. Hitters could be closer to 70%. I used my calculated values and ended up with this team:

I did everything as planned but I didn’t end up with a pitching staff that meets my standards. Not even close. I like going with the lesser-stars and scrubs approach. I never have many players who would be drafted in the first couple of rounds. Instead, I wait for the inflation to disappear and load up on 4th to 6th rounders. Good players, but not stars. Even though Jim Bowden on SiriusXM had his doubts about me pulling it off (I was the last person to roster a player), the hitters eventually came and I should be competitive.

The starting pitchers never did drop below the early inflation. With the cost even above my ADP projected values, I thought values would eventually appear. Nope. I kept trying to push past my values a dollar or two, but the pitchers kept going higher. Here is a graph of my values, the ADP values, and actual results for starters.

The deals never permanently materialized until around $8 while some deals started around the $10 mark. Now, compare that graph to the non-catcher hitters who saw the cost and my value merge at ~$20. I have a ton of hitters around $20.

I should have jumped in and paid up for another top arm but the hitter deals were too good to pass up. I kept seeing $5 hitter values instead of overpaying $5 for pitchers. I just thought the price curve would drop below my values. It did but after $10.

At some point during the auction. I just decided to load up on hitting, hope to possibly trade some off, and I just need to grind-and-churn pitching. So, once the dust settled, here were the final splits.

Overall Splits
Projections ADP Actual Me
Non-Catchers 1873 1814 1851 171
Catchers 235 139 158 15
Total 2108 1952 2009 186
Relievers 265 248 249 29
Starters 731 858 857 45
Total 996 1106 1106 74
Split 67.9% 63.8% 64.5% 71.5%

I messed up in several ways.

  • I should have one fewer “value” $20 hitter and spent the money on a decent pitcher. While I can trade, my pitcher-hitter split is dramatic.
  • These splits remind to pull players into the four pools and divvy out the dollars between them. I put too much into catchers and closers. I was thrown off for a bit with the early catchers going near my bid price. After the top six, the bids just dropped. We spent more on catchers than ADP suggested but not as much I predicted. Oops.
  • More importantly, I’m not sure why I didn’t follow the current public splits. The values are eerily close. The draft was full of the industry’s movers and shakers. Hell, Ron Shandler was there. They are influencing draft ADPs and why not use it to get an idea of how they are thinking. Also, their only market gauging option was the ADP I used. I didn’t know thy enemy.
  • While I should have come off my values some, I found myself anchored to the values in front of me. I need to move off the values a little faster or have better-projected values that take into account public demand.

I was overthinking things. Or just too focused to notice the obvious. Whatever happened, I messed up not taking into account the public demand. With the offensive base, my team can win if I play the weekly matchups and can hit on a breakout pitcher or two.

Jeff, one of the authors of the fantasy baseball guide,The Process, writes for RotoGraphs, The Hardball Times, Rotowire, Baseball America, and BaseballHQ. He has been nominated for two SABR Analytics Research Award for Contemporary Analysis and won it in 2013 in tandem with Bill Petti. He has won four FSWA Awards including on for his Mining the News series. He's won Tout Wars three times, LABR once, and got his first NFBC Main Event win in 2021. Follow him on Twitter @jeffwzimmerman.

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Pirates Hurdlesmember
2 years ago

“I found myself anchored to the values in front of me. I need to move off the values a little faster or have better-projected values that take into account public demand.”

This, the best laid-plans and all. Seems like every auction does this in one direction or another. Had a 20 teamer where I failed to realize how few good SP were not kept and it went crazy sideways on those few available arms. I’ve always tried to treat auctions somewhat like a draft where I expect to get x,y,z type players. That way if I need to move off values I can while I have a chance and well before you look around and have the most money left and no one worth spending it on. Especially in shallow leagues like a 12 teamer where stars and breakouts will dictate the league champ, rather than depth in an 20 or 30 teamer..