The State of the AL East

Last year we saw one of the great streaks in sport come to an end: namely the Atlanta Braves’ run of 14 consecutive division championships. This year it looks like the denouement of the Yankees’ nine-year stint atop the AL East.

We’re not even out of May yet and already some are speculating that the Red Sox have a 90% chance of winning the East, which would be their first division championship since 1995. This is radically different to what the media were saying back in the chilly confines of April. Let’s remind ourselves of how various crystal ball gazers thought the AL East would shake out back in late March.

              Chone           Diamond Mind    PECOTA          ZIPS
              W       L       W       L       W       L       W       L
New York      95      67      97      65      94      68      92      70
Boston        92      70      87      76      92      70      87      75
Toronto       81      81      89      73      80      82      84      78
Baltimore     72      90      75      87      75      87      79      83
Tampa Bay     71      91      69      93      78      85      68      94

In my division projections and Tradesports columns I promised that over the course of the season we’d regularly check back in and see whether our predictions were accurate. If you hadn’t already guessed this first installment concentrates on the AL East. We’ll take a look at the updated THT division standings, Tradesports division win probabilities and the PROTRADE stock market.

Current State of the East

Here are the AL standings as of Sunday, May 27 (before Sunday’s games):

American League East        Pwins  Diff
BOS     33  15 .688    0.0   32     1    
TOR     22  26 .458   11.0   23    -1
BAL     22  27 .449   11.5   24    -2    
NYA     21  26 .447   11.5   26    -5    
TB      19  28 .404   13.5   17     2 

And here is the story pictorially, courtesy of the legendary THT division race graph:

image

We don’t need a graphic to tell us that the Red Sox have been on a tear since mid-April—however, as things stand it looks like a battle royal for second place.

The Red Sox have dominated across the board. They are 6-3 against the Yankees, 15-7 against their division and have taken 13 series out of 18 (with two ties). They have the second best pitching staff on the junior circuit (3.63 ERA) and with Ortiz, Ramirez, Drew, Lowell and Youkilis, one of the most potent line-ups in the game, scoring 5.40 rpg. Impressive stuff, no question.

So, given the gulf that has opened up between the Sox and the rest, what are the odds of their winning the East?

THT Projected Standings

Let’s see what the THT statistical model spits out when asked who will triumph in East given each team’s start.

To recap the methodology, what we do is use THT projections to calculate a team’s expected wins above replacement. This is based on player depth charts that I pulled together for each ball club. The division win probability is calculated from win distribution curves that work out the odds of each team finishing on top given their talent—for the technically minded, I use recursive probability functions. Here are the results:

30th March 2007                            27th May 2007
           W       L       Win%            W       L       Win%
New York   95      67      53%             89      73      22%
Boston     91      71      32%             97      65      68%
Toronto    81      81      6%              79      83      5%
Tampa Bay  68      94      0%              68      94      0%
Baltimore  82      80      8%              80      82      5%

At the start of the season our projections pegged the Yankees at 95 wins, with the Red Sox lagging at 91. That gave the Bronx Bombers a 53% chance of wrapping up the East, compared to just 32% for the Sox.

How things turn around—the Yankees are currently on track to win a mere 88 games, although for many teams that would be a great season. However, given the current standings they are closer to the Sox than you may have imagined and according to our numbers still have a 22% chance of claiming the division. The addition of Clemens and the fast-tracking of Phil Hughes, both non-factors in our initial projections, should help the Yankees claw back some games in the second-half.

You could argue that we’ve been conservative on the Sox—back in April we had them as a 91-win team, and they clearly look better than that. At their current pace they are on course for 103 wins, but some regression to the mean is likely, so 97 wins seems a fair outcome.

Outside the top two our initial projections seem pretty robust—we still think the Orioles have a decent shot at .500 ball. And John Brattain will be pleased to hear that we expect his Blue Jays to step up a gear, but to still fall well short of the postseason.

Tradesports Prediction Markets

As regular readers know, Tradesports runs a series of prediction markets to assess the likely outcome of each division. The market matches buyers and sellers at an agreed price that equates to the probability of each team coming top.

Before a ball was thrown Tradesports largely agreed with THT’s predictions, giving the Yankees a 57% chance of romping home with the AL East. Here is what Tradesports’ punters think the win probability of each team is now.

Team              Win% March 30      Win% May 27
New York          57%                18%
Boston            32%                79%
Baltimore         1%                 2%
Toronto           13%                1%
Tampa Bay         0%                 0%

Not too different from the THT numbers, although the market is a bit more bullish on Boston. We’ll take the Yankees, Red Sox and Blue Jays and look at their charts in more detail. First, the Yankees:

image
You can see the precipitous decline through April and May as the Yankees struggled and the Red Sox surged. Not even A-Rod’s long ball barrage assuaged investors. By contrast, the Red Sox’s chart is almost a mirror image:

image
It took a few weeks for the market to realize that the Sox were the real deal as the uptick in win expectancy didn’t start until mid-April, but from then it climbed at the same rate as the Yankees’ fell. You can see a plateau in early May when the gap between the two teams didn’t move—a corresponding flat is seen in the Yankees chart. Also the recent Yankees series win did little to dent the Sox’s overall win expectations.

Finally, look at Toronto’s chart:

image
The Blue Jays’ trend is similar to the Yankees’ but less dramatic. And that is because their odds of winning the AL East were a miserly 15% before the season even started. Their poor start did them no favors and given the strength of the Red Sox it isn’t a surprise that the market is even more bearish on the Jays than the THT model is.

I won’t look at the Orioles and D-Rays because the market assumption is that they are dead and buried, so their contracts are little traded.

PROTRADE Predictions

PROTRADE is a sports stock market where you can buy or sell players and teams depending on whether you think they are over- or under-valued based on a fantasy scoring system.

As I discussed in a previous column this is less useful for players because arbitrary statistics are used, but for teams the scoring system is more sensible so we can build a picture as to how well people think each will do.

Here is a reminder of the points scoring system:

Price	Criteria
$1 	for each regular season win
$10	for qualifying for the playoffs
$4 	for each playoff win
$10 	for winning the league division series
$20 	for winning the pennant
$30 	for winning the World Series

Have a look at how the price of the AL East contenders has waxed and waned since mid-April (when PROTRADE first launched this feature).

Team         Price (April 21)   Price (May 27)     Earnings (May 27)    P/E
New York     137.19             116.76             19                   6.1
Boston       132.93             141.18             31                   4.6
Toronto      91.13              88.97              20                   4.4
Baltimore    77.79              79.54              20                   4
Tampa Bay    78.95              80                 19                   4.2

The Red Sox have surged into top place with a price of $141. This suggests that they are expected to waltz into the ALCS at a minimum. In fact the price intimates that a World Series appearance is almost expected. Given the uncertainty of progressing in the postseason this feels ambitious even with their torrid start.

Perhaps more surprisingly the Yankees are only a few dollars back at $117—which is third highest overall behind the Mets and Red Sox. There is still a strong expectation that they’ll play October ball. Interestingly, PROTRADE also reports earnings, which is how many points each team has accrued to date. The market expects a dramatic improvement by the Yanks as evidenced by their astronomical Price/Earnings ratio (the highest of all MLB teams).

The Blue Jays are next on the list and given the strength of the Yankees and Red Sox the market thinks there is almost no chance they’ll make the playoffs. The price effectively reflects their expected win total plus a smidge—probably about 83 games in total. The D-Rays are next on the list with an expectation that they may crack the 80 win mark, while the Orioles surprisingly bring up the rear on about 77 wins.

Wrapping Up

Both markets and the THT statistical model are in unison that the Red Sox are (unsurprisingly) overwhelming favorites for the AL East. Conveniently the THT model is in uncanny agreement with Tradesports. PROTRADE factors in the wild card and, quite frankly, expects the Yankees to secure it. I don’t know—given the ding-dong between the Tigers and Indians in the AL Central I suspect the final berth will come from that division. We’ll twist the microscope on to that division in a couple of weeks.

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