Thursday, February 21, 2008

My approach to player valuation

1. Standings Gain Points (SGPs) — Standings Gain Points were developed by Alex Patton in the 1980s. In order to win a fantasy baseball league, you must accumulate more points across a variety of categories than everyone else. That is the goal of every single person playing in a rotisserie-style league. So wouldn't it make sense to value players based on how many points they can gain for you in the various categories? Standings Gain Points do just that.
   
   Standings Gain Points convert a player's contribution in each category into the number of points those stats will allow you to gain in the standings. Adding up a player's contribution in each category gives you his full SGP value.
   
   
2. Replacement Level Theory — Replacement level theory used for fantasy baseball is very similar to Value Over Replacement Player (VORP), a statistic with practical baseball applications that was developed by Keith Woolner in 2001. Replacement level theory allows us to adjust for position scarcity.
   
   To use replacement level theory for fantasy purposes, you first figure out how many players will be selected at each position. If you're league has 12 owners and starts two catchers, there would be 24 catchers selected. The 24th catcher becomes your replacement level catcher, and his SGP value becomes the baseline for catchers. You subtract this number from every other catcher's SGP value. You repeat the process for each position, and the end result is a list of players spanning every position that are now directly comparable to each other.
   
   
3. Marginal SGPs — Marginal SGPs were introduced by Art McGee in his excellent book How to Value Players for Rotisserie Baseball. If you're playing in a draft setting (as opposed to an auction), it can be ignored. If you're playing in an auction league, though, this is a very important adjustment.
   
   Raw SGPs don't account for the fact that going into every auction, every owner has (essentially) already spent a portion of his budget. Even if you were to wait until everyone else had filled their rosters, you would still need to spend $1 to fill each roster spot. If you're playing in a 12-team league with 23-man rosters, that's a guaranteed $276 that will be spent.
   
   For that $1, every owner will get, roughly, the exact same SGPs. Even if you don't buy any players for $1, it is still built into the value of every other player. Every player will get you those baseline SGPs, and the good players will then accumulate more on top. Because all owners are equal in this regard, no value is gained from that $1. Marginal SGPs determines the dollar value of players while accounting for this fact.