Page 1 of 1

buy or sell at the trade deadline?

Posted: Thu Jan 29, 2015 6:53 pm
by ampersand5
Before I start doing research on this issue, I was wondering if anybody had any thoughts on the topic they wanted to share.

Essentially - I want to know what the increased cost is of trading for a player at the trade deadline.
Should playoff teams not contending for a championship be trading their players (or at the very minimum, expiring contracts who they do not think are going to come back)
What is the value to a team of potentially (both money, hype and experience) making an additional round in the playoffs?

Re: buy or sell at the trade deadline?

Posted: Thu Jan 29, 2015 8:45 pm
by Crow
i guess the trading season can be divided into: At draft, next few weeks, rest of summer, during camp / preseason, season before deadline, and deadline week (or two). Some analysis of relative pricing would be worth seeing. Always more that could / should be done with time and incentive.

I think it is well past time someone tried to fashion a decent one-metric trade valuation model / system. Dean Oliver talked about a crude one ten years ago. I might get around to it but perhaps someone is interested in the idea as well? A one number trade value isn't going to replace a nuanced and comprehensive evaluation but it could be useful for screening trade ideas or giving first cut evaluation of trades. If a trade fails this test, what is the rationale that supersedes the simple but not fully aware metric estimate? Even though I called it a one metric and a simple one, it might be possible to develop a trade metric where the one number estimate is contingent and variable based on a specified general strategy (win now at any cost, long term rebuild and in-between, with different cap situations and dispositions too).

Re: buy or sell at the trade deadline?

Posted: Sun Feb 08, 2015 7:03 am
by Crow
The value of a playoff series will vary by market size, popularity, income and status but is probably at least $5 million and could be worth $10m plus in some markets. The capitalized value is probably several multiples of that, if playoff success is consistent. The experience value is harder to pin down but playoff exposure is a pre-requisite to playoff success and prior playoff success is positively correlated to future playoff success, if I recall correctly, and that future greater success has operating an asset value; so yeah that experience is probably worth even more. Maybe a series win is worth $20-35 million depending on market. Perhaps that is too high for first round but I think it is in that neighborhood for higher rounds.

Re: buy or sell at the trade deadline?

Posted: Mon Feb 09, 2015 4:52 pm
by Crow
If there is "increased cost" at the deadline, it is probably on the seller faced with not making the move. Buyers probably are paying far prices to getting relative bargains compared to other time periods, I'd say.

Re: buy or sell at the trade deadline?

Posted: Sun Feb 15, 2015 2:31 am
by hoops
Are you wanting to look at this from an accounting/finance aspect or winning down the road? If economics comes into it as other have said the market is going to have a huge swing. Seems like a question where the definitions of success need to be well established upfront.