Unpicking the AL Central

A couple of weeks ago I looked at how the race in the AL East was shaping up under the glare of the THT model, Tradesports prediction markets and PROTRADE.

Perhaps the most interesting conclusion was that while the Bronx Bombers were rank outsiders to storm the division, they did (at the time of writing), have an excellent shot of playing October ball via the Wild Card, according to PROTRADE.

However, the strongest division in baseball is, for once, not the AL East but its close cousin, the AL Central. Today I want to twist the THT microscope on to the happenings in the American Midwest.

What was Said in March

At the start of the season the outcome of the Central was probably the least certain of all the divisions in baseball. With the 2005 World Champions, a resurgent Tigers, a young, improving and heavily favored Indians side, and the 2006 division champs all vying for top spot the division was almost impossible to call. The THT staff forecasts prove the point—four of the five teams were picked by one of us.

Here is what some of the more well-known pundits speculated:

             Chone           Diamond Mind    PECOTA          ZiPS
             W       L       W       L       W       L       W       L
Minnesota    92      70      88      74      90      72      88      74
Detroit      87      75      89      73      84      78      90      72
Cleveland    87      75      92      70      87      75      88      74
Chicago      76      86      77      85      74      88      77      85
Kansas       64      98      65      97      66      96      65      97

There are a couple of things worth mentioning. First, there is little unanimity as to which team will come out on top. Detroit, Minnesota and Cleveland were each picked to win the division. Second, I was slightly surprised with the consistency with which Chicago was expected to win 74-77 games. Given the short shrift that was heaped on PECOTA after it predicted the White Sox would win only 73 games I expected to see a couple of the analysts projecting a .500 team. Remember, this is a ball club that won it all a couple of years ago, beat the 90-win mark in 2006, and hasn’t changed that much—perhaps that is the problem.

Current State of the AL Central

Here are the AL Central standings as of Sunday, June 10 (before Sunday’s games):

American League Central      Pwins  Diff
CLE     37  23 .617    0.0   34     3 
DET     35  26 .574    2.5   36    -1 
MIN     29  31 .483    8.0   30    -1 
CHA     26  32 .448   10.0   23     3 
KC      23  40 .365   15.5   23     0

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

image

It isn’t quite the three-way ding-dong predicted, at least not yet. In fact the Indians, who underperformed their expected record by a gaping 11 wins last year, have a nice cushion at the top. This is largely because they have dominated the second-place Tigers going 5-2 against them after a couple of series in late May and, in contrast to last season, are comfortably outperforming their pythagorean record. Prior to that the Tigers and Indians spent most of the month swapping the top spot.

Both the White Sox and Twins are a handful of games adrift of the top two largely because of a poor record through May and June—the precipitous fall in the graph tells the story. By contrast at one point close to the end of April all four teams were within a game of each other.

THT Model

Let’s see what the THT statistical model spits out when asked who will triumph 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 its talent—for the technically minded, I use recursive probability functions. Here are the results:

	    30 March 2007             10 June 2007
            W       L       Playoff%    W       L       Playoff%
Minnesota   89      73      43%         85      77      22%
Cleveland   83      79      19%         89      73      39%
Chicago     83      79      19%         79      83      8%
Detroit     83      79      19%         87      75      30%
Kansas      67      95      1%          64      98      0%

Obviously our pick, the Twins, aren’t doing as well as advertised but there is still plenty of time left before we need to cash in our chips. Given the current standing, the THT model has switched allegiance to the Tribe, but it suggests that the Twins and Tigers are both still in the mix.

How does that work when the Indians are romping away with the division? First, the Indians are overachieving at the moment—they are three wins ahead of their pythag, while the Twins are one win adrift of theirs. Second, we are working on thin margins—had the Tigers gotten the better of their recent match-up with Cleveland the division picture would look quite different. And third, our preseason expectation was that the Twins were (and still are) more talented than both the Tigers and Indians.

Judging from reader mail, the AL Central was probably the most controversial of our division predictions largely because of our optimism over what, to be fair, has turned out to be a ropey Twins rotation. However, given what happened last year it is still far too early to concede defeat.

Tradesports

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-upon price that equates to the probability of each team coming out on top.

At the start of the season it is fair to say that THT and Tradesports disagreed as to who would win the Central. The market view now is that we were both wrong!

Team          Win% March 30              Win% June 10
Minnesota     24%			11%
Cleveland     24%			50%
Chicago       21%			4%
Detroit       30%			35%
Kansas City   2%			0%

Tradesports thinks the current standings are reflective of how the division will look in October, with Cleveland clear favorites, Detroit in second, Minnesota on the fringe and Chicago seemingly edging away. The THT model is more bullish on the Twins because we think that their talent level is above their current performance level, whereas Tradesports thinks current performance is a better indicator of true talent.

Let’s step through each team’s win expectancy graph as the season has unfolded. First, the Indians and Tigers together:

image

The Indians have been playing well all year, and the market realized it misrated them almost from day 1—you can see a steep change in win expectancy in early April despite a series washout against Seattle. It was at the end of April that the Tribe really started to accelerate as they won eight of 10; that form continued into May as first the Twins and then the Tigers were swept.

The Motown gang, on the other hand, have been treading proverbial prediction market water, not that that is a bad thing when your odds of winning the division continue to hover in the 30-40% range. In essence they have performed exactly as the market expected and are still very much in the thick of things. Their win expectancy took a hit late May/early June as they lost seven of eight but has rebounded recently after a couple of good wins against the Tribe and a series win at Texas.

Now we’ll look at the White Sox and Twins:

image

Both these teams have seen a similar downward trend as the season has progressed. Actually, Minnesota managed to maintain position through April as they very much stayed in contention and were as little as a game back on April 28. However, a 15-19 slump since May 1 has seen their win expectancy swiftly erode.

Given that many analysts (THT excepted) predicted that the Sox would be a 77-win team at best, it is no surprise to see their win expectancy erode from day one. The loss of two early series to the Indians (the first in arctic conditions) must have dented the market’s confidence. To be fair to the South Siders, they managed to keep their heads above water until late May when, like the Tigers, they suffered a sharp reversal, losing nine of 11. In this stretch they were swept by the Twins and steamrolled by both the Blue Jays and the resurgent Yankees. As far as Tradesports is concerned, the White Sox should focus on 2008.

PROTRADE Stock Market

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 Central contenders has fluctuated since mid-April (when PROTRADE first launched this feature).

Team         Price (April 21)  Price (June 10)    Earnings (June 10) P/E
Cleveland    $107.26           $120.54            $36.00             3.6
Detroit      $101.39           $111.07            $33.00             3.7
Minnesota    $113.21           $104.51            $28.00             4.1
Chicago      $91.64            $95.76             $25.00             3.9
Kansas       $64.89            $65.72             $22.00             3.3

PROTRADE is a useful adjunct to the THT model and Tradesports as it takes into account success in the playoffs as well as what happens in the division.

Scanning down the before and after prices PROTRADE users haven’t changed their minds that much about the outcome of the Central. Sure teams have ebbed and flowed in price—the Twins have fallen slightly while the Indians and Tigers have firmed up—but PROTRADE agrees more with the THT model than Tradesports does.

Unsurprisingly PROTRADE rates Cleveland as favorites. Their current price of $120 implies they are a strong bet to win their division and progress to the ALCS. Detroit and Minnesota are jockeying for second spot around the $105-110 mark, reflecting the belief that the Wild Card will come from this division. The White Sox, at $95, are starting to fall away, while the Royals are just expected to avoid another 100-loss season.

Interestingly, the Twins have the highest P/E ratio suggesting that they are underperforming their talent level the most—supporting the THT model.

Final Thoughts

As predicted at the dawn of the season the AL Central is probably the toughest league in baseball. That the Indians are on top is little surprise—they were the smart analyst’s (no comment) pick at the start of the season. However, the quality of the other teams is deep. Any one of them could be in pole come October.

References & Resources
Again thanks to Tradesports and PROTRADE for doing this stuff and making this column possible.

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