Making Ottoneu Arbitration Work for You

Ottoneu arbitration opened last week and that inevitably leads to a million debates about the right way to do your arbitration. Do you allocate funds to Pete Crow-Armstrong no matter what team he is on? Or do you make sure to prioritize using arbitration to rein in the best teams? Do you assign arbitration to rookies or prospects? Or only give to established players?

On Friday, I published an updated Ottoneu Arbitration Omnibus that has a bunch of articles covering these kinds of strategic questions, reviewing arbitration results from the past, and more. And there is a ton of good stuff there.

But today, I want to focus on a single, simple concept the drives my arbitration strategy:

I want my arbitration to help my team as much as possible for as long as possible.

The rationale for this is pretty simple: I am here to win trophies. I mean, yes, I also like to socialize and make friends and all that stuff. But I like to compete and I like to win and the question behind basically every decision I make in an Ottoneu league is the same: Will this help me win more titles?

Arbitration is no different, whether it is a vote-off league or an allocation league. Arbitration isn’t primarily about punishing other owners or knocking teams down or getting players up to fair market value. Those are all secondary. It is primarily about doing what I can to win.

The two pieces of that line above (“as much as possible” and “as long as possible”) are the driving factors behind some of my most-used strategies.

Allocate to Teams, not Players

If my primary goal is to win, then every dollar I assign should be in service of that. And allocating $3 to a very low-priced player on a team that I don’t think can compete simply isn’t helping me win. There is a team in league 1 with a $9 Miguel Vargas, $3 Chase Meidroth, and $19 Munetaka Murakami (by the way, manager is not, as far as I know, a White Sox fan). That team also finished 11th this year and is likely to have a new manager for 2027, and needs a heavy rebuild. Those three all look like varying degree of great assets, especially in 4×4. That $9 Vargas is a dream.

But I think that team is at least a year away from contending. And the question I am asking myself with every arb dollar is the one outlined above: Will this help my team as much as possible, as long as possible? Putting $1 on Vargas will help, for sure. And I have to assign $1 to every team. So Vargas is a good place to start. But putting a second dollar on Vargas or an extra on Murakami or Meidroth simply isn’t going to do as much to help my team win next year as putting those dollars on a more competitive team.

Now, you might note that “as long as possible” means I am not only thinking about 2027, and that is totally fair. Maybe this team rebuilds effectively, and having only received $11 in total arbitration this year, they go into the 2027-28 offseason with $19 Vargas, $22 Murakami and $6 Meidroth ($11 in 2026 arbitration allocations plus $2 each in 2027 salary increases). Maybe that team looks like a contender. But a lot can happen between now and then: maybe Vargas or Murakami settle in as $20-$25 values. Maybe Meidroth’s power regresses and it turns out he isn’t that valuable. Maybe someone gets hurt. Or maybe they are all star players.

Regardless of how it plays out, I have 2027 arbitration to adjust. Next year, if that team is looking like a contender and Murakami is looking like an MVP candidate, I can give him the full $3 (as can other managers) and we can boost him to full price quickly. By 2028, those three players could all be at pretty much market value, even with little to no arbitration assigned to them this year. Yes, we could have gotten them there more quickly by allocating to them this year, but this is a zero-sum game and some other player on some other team would be a better value as a result. I would rather risk leaving that good value on a team I don’t expect to compete with.

Be Smart About Who You Expect to Compete With

The counterpoint to all of that is that I may not believe my team is ready to compete next year, so prioritizing 2027 contenders over long-term values doesn’t make much sense. And that is true. When you are identifying the contenders to allocate to, you want to identify your contenders, not the contenders.

If you are building towards 2028, maybe you do put more money on Vargas, if you believe that team is going to be great in 2028. Maybe you put less on a team that looks destined to finish near the top in 2027, but whose roster is aging and getting expensive and likely can’t sustain it through 2028 anyway.

Those are viable strategies because they still fulfill the goal of helping my team as much as possible for as long as possible.

Don’t Worry about Getting to Market Price Immediately

The argument for pushing onto players (“Give $3 to Pete Crow-Armstrong this year, no matter what team he is on!”) makes some sense. The goal of arbitration is to bring players up to market price, and PCA’s market price is going to be very high.

But it is helpful to remember a couple of things. First, Every team gets $11 minimum allocated to them. If that Vargas is the obvious standout allocation target this year on that team, he will get to $20, at least. We are not talking about leaving him at $9. Crow-Armstrong has a median salary of $16. If the is the only valuable player on a team that needs to rebuild, he will be $27 by the end of arbitration. He isn’t staying at $16 just because I prioritize putting $3 elsewhere.

Second, there is a long-game here. If that Vargas gets hit with every possible arbitration dollar, he will be $42 after arbitration closes. That $16 median priced Crow-Armstrong would be $49. Those are high prices, but you might think those guys are actually worth $50 and $60, respectively. So you allocate to them again next year to get them there. But you can do the same thing without focusing on them this year.

Here is what their salary progressions look like if you believe, right now, that they are $50 and $60 players and aggressively allocate to them despite being on non-contending teams:

And here is what their salary progression looks like if they are on non-contender and you choose to target teams instead of players:

Hey, look at that, we end up in the same place! In either case, they can end up at the same final price and same total dollars allocated across the two years.

But going lower on them this year offers some benefits. First, it protects us if that team still isn’t ready to compete in 2028. In that case, we can delay reaching the full market price for another year, if we so choose. I can focus my allocations on hurting the teams I expect to contend with and know that I can get Vargas or PCA to full-price next year. Remember, my focus is helping my team win – making PCA cost $49 this year doesn’t help me win if he isn’t on a team I am contending with.

Second, it protects us a bit if one of them regresses or otherwise loses value. What if we think they are worth $50 and $60 now, but by this time next year think they are worth $30 and $35? That’s an adjustment we can make, by allocating less next year. I want to help my team “as much as possible, as long as possible.” That “as long as possible” is better served by giving myself options in the future.

Allocate to Established Baselines Over Breakouts

There is a balance here, but the concept is based on the same idea just discussed about protecting yourself from regression. If you allocate heavily to a player without much track record or with real question marks, you run the risk of over-allocating.

Chase DeLauter is already being allocated to in some of my leagues. And I am a big DeLauter fan. He has real prospect juice, had an excellent rookie season, and looks like a solid hitter moving forward. There are also questions about his power output and he has a history of not being able to stay on the field. If you think he is a $20 player and push him to $20 this year, that could be fine. But if he settles in as a $10-$15 guy, he gets cut next off-season and your arbitration dollars are wiped away from the roster they were put on. If, instead, you only push him to $10-$12 this year, then you can adjust.

On the other hand, someone like Brice Turang broke out last year and repeated it this year. He is a safer bet to maintain his baseline and if he is underpriced in your league (and with an $11 median salary, he probably is), you can go after him and feel good about it.

This goes back into that “as long as possible” part of my stated goal. If you allocate to a player who is later cut, those allocation dollars are no longer hitting that team’s budget. I want those dollars hitting other teams for as many years as possible.

Don’t Stress About Theoretical Trades

There has been some discussion about the risk of leaving an underpriced player on a non-contender too cheap, and having them get traded to a contender. What if I don’t assign dollars to that $9 Vargas or $16 Crow-Armstrong and one of them gets shipped off to one of my biggest competitors in December?

That’s a risk, I guess, but it is not one I am worried about. A non-contender has no real incentive to trade Vargas or PCA at $30 below their market value. Limiting allocations to those players actually decreases the likelihood that the non-contender trades them.

And if they do trade them, the return should be meaningfully better. If you are looking at offseason trades, how much more are you willing to give up for $27 Crow-Armstrong or $20 Vargas (remember, $11 minimum per team) than you are for $49 Crow-Armstrong or $42 Vargas? Probably a lot! Which means that if those guys stay low price and get traded to a contender, I am, in fact, hurting that contender by making them give up more in the trade.

Then, after the 2027 season, as outlined in the tables above, you allocate more aggressively to those two. By the start of 2028, the contending team has a full-price star, but they gave up a lot more to get them.