Who Should I Keep?

Fresh off a wire-to-wire victory in my high stakes league, there is no time like the present to begin thinking about next year. One rule we have is called the “Z” rule. Essentially it allows you to sign to a one-time, one year contract any player whose contract expired this year. The primary focus is to allow one more year of a great bargain. The cost is an extra $10 in salary per year, plus a transaction fee that goes into the prize pool ($50). We can resign one and only one player in each of the AL and NL.

The players that fit the bill on my AL team are David Ortiz, C.C. Sabathia,Justin Morneau and Bobby Jenks.

Justin Morneau
I acquired Morneau two years ago in a trade for Alex Gordon. That worked out fairly well since it was early enough last year that I got Morneau’s surge. His contract is 12L1, meaning that he was auctioned at $2 a few years ago, then had his contract extended after year two for another two years at $5 per year. So, if I “Z” him he becomes $22 next year.

He has a low salary so that is an argument in his favor right off the bat. Sabathia is $16 and Ortiz is $20, so they would become $26 and $30.

Morneau was definitely a disappointment. He only produced about $19 or $20 in value this year despite his 31 HR and 111 RBI. He hit only .271 with a .343 OBP. He was beset by a few nagging injuries this year. His K/BB ratio was up a tick or two. Overall it appears that his skills stayed pretty constant, but that he was hit with a bit of regression this year.

His second half was disastrous though, with only 11 HR and a .263 BA. August and September were particularly atrocious, with BAs of .221 and .215 with only 3 HR.

David Ortiz
There isn’t much to say about him in this context, the only real question is how much profit can I expect if I sign him for $30. This year he produced about $32 or $33 in value, depending on format. His BA of .332 though is likely due for a fall, as BaseballHQ has his xBA at a more pedestrian .306. Unlike Morneau, Ortiz roared home this year, with an 80% hit rate in the last week and a 40% hit rate in the last month, batting .393 with a .509 OBP. No wonder why Sox fans think he is clutch.

Ortiz is 31 years old and still in his prime. It is questionable though how much profit he will turn next year especially if he is due for a correction in the batting average department. This is a very tough call. It may all come down to projections.

C.C. Sabathia
As much as I love him (and I do love him having made a preseason prediction that he and Lackey would be one-two for the Cy Young this year that may be thwarted by yesterdays Red Sox hero) it is very tough to make him a $26 pitcher. It is a matter of my general philosophy that I do not want to spend $30 on a pitcher unless he is a sure thing. I paid $30 for Peavy this year and he was the first starter I paid $30 for in nine years (if not longer.) So starting with that premise the burden is on me to convince myself otherwise.

In his favor there are quite a few factors:

1. He will certainly go for more than $26 in the auction.
2. In many ways the Indians’ offense underachieved this year, so it is at least conceivable that he will still get enough run support to rack up wins next year.
3. We have a tough innings requirement, and C.C. is a workhorse. One pitcher like him goes a long way to making the innings requirement.
4. If I do keep him he will definitely have excellent trade value in the event that I cannot retool to make a run at first place again. That is, if he is healthy of course.
5. His xERA is a stellar 3.34, so this year was no fluke. And he was worth exactly $26 in a five by five format.
6. His strand rate and hit rate were unlucky, if you can believe it. He had a 32% hit rate and a 74% strand rate, both above expected norms.

So, assuming good health he appears to be a very solid bet to repeat this season again next year. Improvement wouldn’t be a surprise either based on those hit and strand rates.

On the negative side of the ledger:
1. The opportunity cost of the $26–perhaps I can spend it more efficiently somewhere else.
2. I can only likely gain a few dollars profit if at all.
3. Lets assume that I have a 60% chance of a $5 profit and a 40% chance of a loss. If I have a 60% chance at a $5 profit and a 40% chance at a $10 loss then I should pass. I think the balance of probabilities is that any loss by C.C. at a $26 salary will be in excess of $5. So then the question is how much of a loss? One can do the math and figure out the exact break even point, but since I have a better choice, I have to pass on C.C.

Another big negative: 241 IP this year plus playoffs. Prior to this year he had never gone 200 IP, though he was over 190 every year. An increase of 50 innings is generally a red flag for the following year.

Bobby Jenks
Jenks clearly had a career year. Generally he has had poor control with walk rates of 3.5 and 4.0 in 2005 and 2006. He was successful by having huge strikeout rates of 11.5 and 10.3. This year was a reversal. He only struck out 7.8 batters per nine innings and walked 1.8. His 2.77 ERA and 0.89 WHIP are tasty also. Plus he has a $10 salary, so if I “Z” him he becomes a $20.

No matter what one may think of Jenks, this is good value but not tremendous value. He may very well reproduce a $30 season next year, earning me a profit of $10, and he will be a great trade chit no matter what happens. In tough, competitive keeper leagues the prime strategy in dealing with closers is to speculate and try to hit a home run. Plus, you can usually trade for closers during the season. So the issue becomes whether you can spend this money more efficiently in the auction, and often you may be able to.

It seems like this should be a “no-brainer” decision, but there are a multitude of factors to consider, not just whether I will turn a profit with Jenks. I haven’t made a decision yet of course. There is no sure lock among any of these players. Most owners would likely think that four of the best players in the AL are surely worth $30 and would have no problem with a decision to extend any of them. Yet, down this road lies a fifth place finish in 2008. As always, when making a decision one of the most important considerations is what your co-owners will do.

With Sabathia, for example, if I believe he is a bad risk at $26 and will go for $30 then I should throw him back. Fantasy baseball is a zero sum game, and every mistake my opponents make that I do not results in profit/points for me. So if there is a chance for a $10 loss if he goes for $32 (as an example) then this is an easy decision; not only do I avoid the loss myself, an opponent takes a bigger loss and $32 comes out of the available auction money pool.

This principle is probably the most important one to fully understand and exploit if you are in auction leagues. It is not easy to goad tougher owners into making mistakes, but the attempt should always be a part of the decision making process. Every year there are players like this that I throw back, and usually at the auction you hear a comment like “you should have kept him” when he is auctioned for more than I could have kept him. That is exactly what I am rooting for with these players.

This is no easy decision at all, and the weight of the evidence here is that even though these are all fantasy studs, none may be worth extending. It is essentially a risk/reward calculation revealing marginal profits to be had at much higher risk than needed in all cases, except for maybe Jenks.

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