Values have been updated: whose changed the most?
So now we know: 60 games. Pro-rated salaries.
That means that, for virtually all major-league players, they have new trade values. And you’ll see that a lot of them changed dramatically.
As a reminder: Trade value = estimated field value – salary (over a fixed period of control, and with some adjustments for market factors)
Since the length of the 2020 season was reduced, it means that we had to recalculate both the field value for this year (37% of the preseason number) and salary (also 37%, but since the players were given a small advance in March, it works out to about 35% left for them to earn).
Importantly, the March agreement granted the players service time credit during the stoppage. So for this purpose, we all basically have to pretend that four months of the season have been played, and that players’ performances matched their projections. We are now projecting the final two months on that basis.
Note: these values are current for right now. They will change again by the trade deadline, which is now Aug. 31.
So what did we find?
Players whose values were impacted the most: Good ones, close to free agency
This may be self-evident, but it’s worth a reminder: The closer players get to free agency, the more their surplus values drop, because they mean-revert to zero. Those missing four months knocked out a lot of positive-value surplus — primarily for walk-year players like Mookie Betts, Marcus Semien and J.T. Realmuto, but also for next-to-walk-year players like Francisco Lindor and Trevor Story. Players whose free agent contracts were back-loaded also were impacted, as any near-term surplus baked in for this year was mostly wiped out by the stoppage.
The opposite is also true: Negative-value players become less negative
Interestingly, players whose contracts are deeply underwater became less so under these conditions, for reasons similar to those above: the closer the contracts get to expiring, the more these too mean-revert to zero — highly overpaid players become less overpaid. As above, you’ll see large effects on negative-value players in their walk years, such as Wade Davis and Jeff Samardzija, as well as those with a little over one year left, like Khris Davis.
QO and draft pick compensation
Since the season hasn’t technically started yet, it’s our understanding that teams can still trade for a player in his walk year with the hidden bonus of being able to receive a draft pick if they later extend a qualifying offer (QO) and the player declines it. We estimate the value of that pick at roughly $9M, and that’s embedded in our valuation.
However, once the season starts, this value will immediately disappear, because the rule states that the player must be on the same team the entire year. So if, say, the Yankees traded for Robbie Ray now, they’d have to give up around $14.2M in value. If, however, they execute that trade after the season starts (before the deadline), they’d only have to give up around $5.2M in value, because they would have then lost the ability to get that draft pick, since Ray could not be QO’d under those circumstances.
Players whose values didn’t change much: Younger, with lots of control
We found that the values of players who are still pre-arb, with multiple years of control left, had their values affected less than older, higher-paid veterans. That’s because there is still plenty of surplus embedded in their projections, and most haven’t peaked yet.
Similarly, with prospects, there’s no change at all, because they haven’t started their service-time clocks yet. (If the current service-time structure of six years of control changes after the next CBA, we’ll adjust accordingly, but for now we have to assume it will stay intact for the purposes of our model, which means that prospect valuations are still based on that structure.)
The declining cost per win
Normally, our model assumes that the cost per win rises at 3% per year on average, which is roughly in line with long-term inflation projections in the general economy. However, all teams have taken a severe financial hit in 2020, and based on what we’re hearing from front office executives, team payrolls will likely come down soon.
Therefore, we are anticipating, conservatively, that the cost per win will come down in 2020 and remain flat in 2021 (and that itself may be too optimistic). After that, we’re assuming a return to the normal 3% for 2022 and beyond (with the caveat that that could change as well, depending on the new Collective Bargaining Agreement at that point).
That means that field values have come down in the near-term, which in turn impacts overall trade value.
With that, here are examples of positive-value players who saw big declines (along with their previous pre-season number):
- Mookie Betts [5.4] ; preseason value: 64.2; change: -35.9
- Francisco Lindor [35.6] ; preseason value: 63.6; change: -21.6
- JT Realmuto  ; preseason value: 38.4; change: -18.9
- Anthony Rizzo [30.9] ; preseason value: 53.5; change: -17.7
- Marcus Semien  ; preseason value: 35.8; change: -17.2
- Trevor Story [39.5] ; preseason value: 52.4; change: -16.7
- George Springer  ; preseason value: 35.7; change: -15.5
- Corey Seager [31.7] ; preseason value: 51.0; change: -15.3
- Trevor Bauer  ; preseason value: 31.1; change: -14.2
- D.J. LeMahieu [13.0] ; preseason value: 28.9; change: -14.2
- Carlos Correa [41.2] ; preseason value: 49.6; change: -10.8
- Robbie Ray  ; preseason value: 23.4; change: -9.2
- In most of these cases, the lost time in 2020 wiped out a big chunk of on-paper surplus; these stars were projected to produce well above their salary level — in other words, the lost field value affected them (and their teams) more than the lost salary.
And here are the negative-value players whose values increased the most:
- Johnny Cueto [-19.7] ; preseason value: -39.6; change: +11.1
- Albert Pujols [-32.6] ; preseason value: -59.0; change: +9.7
- Jon Lester [-10.0] ; preseason value: -22.1; change: +8.5
- Khris Davis [-16.2] ; preseason value: -29.5; change: +8.1
- Dexter Fowler [-19.8] ; preseason value: -29.4; change: +6.7
- As noted, we will update all values again before the trade deadline.