The high price of win-now talent at the deadline

The non-waiver Trade Deadline has passed, and the Cardinals did their Cardinal deadline thing. Once again, the Cardinals traded a former high round pick whose stocked has since dropped, for a marginal upgrade. Zach Duke will help solidify the bullpen, and any plans the Cardinals may have had for Charlie Tilson are now out of the picture. With a lot of position player depth and still no opening in the rotation, this was about what was expected. The Cardinals were barely connected to anyone the entire month, including the guy they ended up acquiring.

Some wanted to see the Cardinals make a significant upgrade, but we see now that very few impact players changed hands at the deadline. Jonathan Lucroy was the biggest non-reliever name to change teams, and even if the Cardinals did have a need at catcher, the Brewers probably would have needed to be blown away by the Cardinals offer in order to deal him away in-division.

Drew Pomeranz and Rich Hill represented the top of the market with regards to rotation upgrades, and would only have made sense if the Cardinals got creative by trading one of their starters in order to create an opening for either. The high-end of the reliever market was represented well by Andrew Miller and Aroldis Chapman, but both went for incredibly valuable prospect packages.

There were other big names out there that could have been moved. White Sox co-aces Chris Sale and Jose Quintana were rumored to be available. Evan Longoria and Freddie Freeman were signed to high dollar, but good value contracts playing on non-contending teams. With the Cardinals being a well-rounded team lacking on high-end talent, a big move for one of those four was certainly an intriguing, if unrealistic scenario.

One reason standing in the way of the Cardinals making a big move: they were buyers in a seller’s market. This July had quite a bit less intrigue than 2015: consider that Cole Hamels, Troy Tulowitzki, David Price, Yoenis Cespedes, Ben Zobrist, Carlos Gomez, and Johnny Cueto all changed teams last July. The few selling teams with good trade chips knew it, and bargained appropriately.

To make a big move, let’s assume the Cardinals would have had to part with at least one of their better prospects. Let’s say a Top 100 prospect. The Cardinals have three or four, depending on if you ask Baseball America or MLB.com. Here’s the Cardinals' top prospects according to those publications:

Reyes is of course the cream of the crop, with Luke Weaver and Harrison Bader cracking the back of the top 100 of both. Jack Flaherty also made it into BA’s list.

With that, we turn to The Point of Pittsburgh’s excellent research on the average Surplus Value of past Top 100 Baseball America prospects. I recommend reading both the original article and the 2016 update, but in lieu of that, here is a table with the Surplus Value for each group of prospects the writers tracked:

The original study uses Baseball America, but in order to use more data, I decided to include MLB.com’s prospect rankings as well. Ten prospects were traded this month that appeared on at least one of the lists, with all but three appearing on both. For each, I took the Surplus Value which corresponded to Baseball America’s ranking, and the same for MLB.com, and averaged them.

For the three players who only appeared once, I used three-fourths of the Surplus Value of the 76-100 group. My logic was with such a small decline between the 51-75 group and the 76-100 group, there probably wasn’t much additional drop going to a 101-150 group, which is where those prospects probably would have ranked. Here are the results:

Some high priced assets were moved, but none can top Alex Reyes’ $69.9M projected Surplus Value. Five prospects were dealt that beat Luke Weaver and Harrison Bader’s projected Surplus Values of $19M and $20.6M respectively. Jack Flaherty ties Frankie Montas and Grant Holmes value, both dealt from the Dodgers to the A’s along with Jharel Cotton for Josh Reddick and Rich Hill.

Let’s compare that to the major league pieces acquired with the prospects dealt. I took each MLB player in those deals, as well as their Fangraphs’ Depth Charts Rest of Season (ROS) projection. I also took their 2016 salary, and their years of control and total salary. Using their current ROS projection, I pro-rated their WAR projection to a full season, and declined it 0.4 WAR per season (0.2 WAR for relievers) that they were under control. Then, I used $8M for last off-season’s price of a win, and doubled it to get the price of in-season wins, concurrent with Dave Cameron's research. Finally, I used 5% inflation from that $8M/WAR for years after 2016.

For the arbitration eligible players, I used the 40/60/80 system, which won’t be exact, but get’s us close enough. I decided not to do that for Drew Pomeranz, who is earning $1.4M in his first year of arbitration. He’ll get a big raise, but because of his low salary this year combined with the fact that he now looks like a 3+ WAR starter, it’s unrealistic to expect him to get a salary commensurate with 60% of his new value next year.

That gave me all the variables I needed to create a Surplus Value for each Major League piece involved in a deal for a Top 100 prospect. I also included Adam Warren and Matt Duffy, two major league pieces traded for win-now pieces in the Chapman and Moore deal:

Pomeranz's projection, like the rest of the starters, is based on 200 innings a year. You could make the argument that his history of low innings totals means we shouldn’t expect him to go 200 innings a year, and I could agree with that. Knock him down to more like 170-180 a year and that probably knocks him down to about $40M.

So now we have a valuation for each Major Leaguer and Top 100 prospect traded in these deals, let’s put it all together. Here’s each of the eight deals made that involved a Top 100 prospect, with each side of the deal assigned a Surplus Value:

So, combining Point of Pittsburgh’s research, Baseball America and MLB.com’s midseason lists, Steamer and Zips projections, Dave Cameron’s in-season win premium, and my general aging curve gives us a number for each side of each team's trade. Of course, the team's  valuations themselves can and do differ wildly on any of these players, this is just an estimate in order to compare apples to oranges. I wouldn't say this decides who "won" a trade, as that would involve heavy analysis of each individual prospect and player. This is just to get us most the way there, and judge the market as a whole.

Generally, the sellers have received the better values. One exception, the Pomeranz trade, is much more even if he’s a 170-180 inning starter, rather than 200. The only other is the Dodgers and A’s deal, where the Dodgers are getting a pitcher currently on the DL and a position player that recently came off it. That’s also with no value attributed to Jharel Cotton, who doesn’t appear on either Top 100 list but is nevertheless worth something.

All in all, the sellers received $351M in total Surplus Value in return for $217M in mostly short-term Surplus Value. That’s quite a gap, especially considering the value of in-season WAR was already doubled, and the fact that the nine non-Top 100 prospects that the sellers received (plus Jarred Cosart, who I forgot was a major leaguer, and Adam Warren, whose $5M value I forgot to add-in) were given a value of $0 in this analysis.

We went into this deadline with the understanding that it was a seller’s market, possibly an extreme one. The result of my imperfect measurement of the players involved makes the case that it was indeed a very extreme seller’s market. In that sense, it’s a good thing the Cardinals only made one marginal move, limiting the penalty of being a buyer in a seller’s market. It's fun when a team adds an impact player down the stretch, doubling down on that season. However, it's more fun to compete for the play-offs every year. By having the discipline to buy only on a very limited basis, the Cardinals make it much more likely to continue to accomplish the latter.