March 8, 2007

BP Unfiltered

YOU DOWN WIT' SGP?

by Nate Silver

Those of you who have been using our Player Forecast Manager product to prepare for your fantasy drafts may have noticed a new feature — the option to use Standings Gain Points (SGPs) to create your dollar values.

What are SGPs? SGP’s are a way to account for the number of positions that you can expect to move up in the standings in a typical roto league by virtue of adding to your total in a particular category. For example, we might find that it takes 6 stolen bases to move up one rung in the standings, and 8 home runs to do the same.

SGP’s are a way of recognizing that all fantasy categories are not created equal. In particular, it’s harder to gain ground in the standings in categories like stolen bases and saves where the distributions are highly asymmetrical, and easier to gain crown in categories like RBI’s where things are divided more equally. Thus, if you turn the SGP factors on, you’ll find the PFM valuations for one-trick ponies like Juan Pierre go down.

The SGP method is not new; it’s been used by folks like Ron Shandler for years. Our ‘twist’ is that rather than coming up with the SGP denominators by looking at the prior year’s standings in a handful of leagues, which might be subject to the vagaries of small sample sizes, we’ve instead derived them by simulating hundreds of drafts based on this year’s projected statistics. These simulations confirmed that it is proper to deflate the value of ‘chunky’ categories like stolen bases relative to ‘smooth’ categories like RBI’s.

SGP’s are not for everyone. In fact, they’re the subject of a great deal of controversy in the fantasy community [ed - a link to a now-missing article at Mastersball has been removed - plenty of fodder to be found via Google if interested]. Some people claim that the SGP method is the only way to come up with good auction values; others insist that they’re mathematical blasphemy.

In accordance with our goal of making PFM the most user-friendly draft software in existence, we’re giving you the choice to make that determination for yourself. But for what it’s worth, after having gotten burned one too many times loading up on closers and speed demons, my flag is planted in the pro-SGP camp.

Nate Silver is an author of Baseball Prospectus. 
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