July 1, 2016

The Quinton

Trading With or As the Leader

by Jeff Quinton

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First, to clarify, by leader, we mean an entity that all others are trailing in a competition, not an entity that others follow in action.

Right now, and always, we are either leading, tied for the lead, or not leading; that’s fantasy baseball for ya. Here at The Quinton, we tend to have our discussions more in terms of teams that are focused on the short term (buyers) and teams that are focused on the long term (sellers) as opposed to teams currently in first and teams not currently in first. The reason for this is that, in theory, which team is in first place should not matter; each team should be focused making decisions that will most increase their odds of winning. As we have so often said, though, “in reality, this reality ain’t theory.” In this case, it does matter which team has the lead. It also matters whether the league is in a redraft or dynasty/keeper league. We will discuss each of those scenarios below, what behaviors those situations tend to cause, and what we can do take advantage or best deal with those behaviors. (Lastly, the scenario we are going to be discussing is when a team has clear lead.)

Redraft Leagues

Common wisdom in redraft leagues (and wisdom that prevails less commonly in dynast/keeper leagues) is that “you should never help the team in first win.” I would argue that we as fantasy baseball participants are not beholden to the interests of the rest of the league and, therefore, should happily trade with the leader if such a trade is the move that will most greatly increase our chances of winning. I can say this, out loud or on the internet or any which way, but we are social organisms that do not like upset the group. As a result, many fantasy participants will in no circumstance trade with the first place team.

What to do if you are the leader in this situation: The first thing we should do is try to find a team that does not adhere to these norms in order to get a reasonable trade done. If we are unable to do so, though, we might still want to consider an overpay if (i) we can afford it production-wise and (ii) it will disallow teams chasing us from acquiring a particularly valuable player. It is also possible that such a trade disincentives other teams from making trades, but that is far less likely in redraft leagues, where the only disincentive would be for teams to give up on the season entirely (and in that case, find a better league). If such a trade or opportunity is not available, then we will unfortunately need to hang tight and stay as sharp as possible in free agency.

What to do if you are not the leader in this situation: As mentioned previously, you should not fear trading with the leader if it is the best possible way to improve your team. Sometimes trading with leaders can be tricky because teams in that position are (i) reluctant to trade away players that have put them in the position they are in and/or (ii) they worry that should such a trade go south on them, that they would have themselves to blame (read: defensive decision making). That said, if this is not the case, we can often get a very fair or even favorable deal with a first-place team because they may have very few teams willing to trade with them.

Dynasty/Keeper Leagues

Trades with the first-place team are far less frowned upon in dynast and keeper leagues than they are in redraft leagues because almost all league participants understand a team (that is not in contention) trading current production for future production. The trade market gets tricky, though, when a team is way out ahead in first. When this happens, teams in contention for “the money,” often feel they have no realistic shot at first and therefore refuse to trade future production for current production. Similarly, teams way out ahead in first place are reluctant to make reasonable trades because (i) they think they can win without upgrading and/or (ii) they know no one else is buying, so they try to get a lopsided deal.

What to if you are the leader in this situation: While traditional economics suggests that we should be able to get a lopsided deal if you are the only true buyer, we need to be mindful of how people respond to fairness. Simply put, if your trade partners think you are being a jerk by taking too much advantage of an already advantageous situation, they might be willing to sell for less of a return elsewhere. It sounds crazy, but we have evidence to support this in the form of an economics experiment called the Ultimatum Game.

In this game, one stranger (we’ll call them Stranger X) is given an amount of money (let’s say $10) to divide between herself or himself and another stranger (we’ll call them Stranger Y). If Stranger Y agrees to how the money has been divided, then each party gets to keep the money. But if Stranger Y does not agree to how the money has been divided, then neither party gets any money. Per traditional economic thinking, Stranger Y should accept any money at all, even one penny in our case. But what this experiment has found is that many people will reject an offer they feel is “unfair,” say only one or two dollars.

This is all to say that if we have a hefty lead and want to put a season out of contention by as much as possible, it will often benefit us to avoid being cutthroat in trade talks. Not only may making such a trade further disincentivize our competition from making a run at us, it may also prevent the sellers from giving our competition extremely favorable deals because of perceived injustices on our behalf.

What to do if you are not the leader in this situation: If we are sellers (as opposed to those in contention), we should obviously be taking the best returns from wherever they might come. That said, if the market is really dead—where neither the leader nor those in contention are actively looking to make trades--we might want to consider giving a slightly favorable deal to a team chasing the leader if we think such a trade will rejuvenate the market by making the leader uneasy and thus more willing to trade. This strategy requires the right players on both our team and those of the buyers as well as a league with an otherwise active trade market.

Lastly, if we are in contention, but seemingly with little shot of catching the leader, we should not be refusing to trade all together. If we can get a favorable trade (or two or three) because of the market conditions, then we should seriously consider going for it. Not only is it fun to be going for it, but for many of the reasons mentioned above (plus the human tendency to be overly optimistic about the future) it may be difficult for the leader to make the necessary moves to keep first place completely out of reach. This is all just one more thing to consider as we keep striving to improve our odds of winning, but we should be sure to not overlook it.

Jeff Quinton is an author of Baseball Prospectus. Follow @jjq01
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