Hi Rowsus
I’m interested in your thoughts from a statistical viewpoint regarding the following:
The general consensus seems to broadly be that we wait for cash cows to rise in value and then use the proceeds to bring a “fallen premium” player into our teams (I know there are probably variations on this approach, but stick with me). This makes pretty good sense, however my question is this – how do we differentiate between a “good” fallen premium and a “bad” one?
For instance, last season a number of premiums (eg Danger, J Selwood, Swan etc..) had poor patches which resulted in their prices falling and thus creating the opportunity to buy premium players at a discount price. Most coaches who didn’t already have these players would have looked at this as a great opportunity, although those with them in their teams may have been nervous, but would have probably kept them in their teams on the basis that you should always “trust your premiums / guns to bounce back”. In respect to the players listed above, this was probably the right thing to do.
However, compare this situation to someone like Buddy (2013 version). He started the season priced above $600k and I’m guessing many coaches would class him as a premo/gun (although some may debate this point). Anyway, he dropped massively off the back of an ongoing run of poor performances and I’m sure I heard much advice throughout the season saying what a bargain he was and that people should get him into their teams. Perhaps at a certain price he was a good buy, but for those with him in their starting team it was a bit of a disaster.
Which brings me back to the original question – in the heat of battle, during the course of a season, how do we decide which fallen premo’s to hold and which to jump off? I know sideways trading is discouraged, so do we just have to stick with a poorly performing player and mark it down as a bad selection (or bad luck) or can we take decisive corrective action (if we identify the problem early enough)? On the other hand, how do we identify the correct fallen premo’s to buy and how to avoid the “fools gold”? Are there any statistical pointers we can look at to help get this decision right?
Thanks
Hi RB, good question.
What you are talking about here is "Tipping Points", and they are pretty much impossible to quantify before hand.
The reason they are nearly impossible to quantify before hand, is there are so many variables in the situation, you'd spend a year planning and writing them out. The main problem is you need to look not only both sides of the equation, ie I have player A and he's falling in price, when do I jump off? And I don't have player A, and I've got my eye on him to trade in. But you have to look at all the alternatives. If you are trading player A out, who is available, and in what sort of form are they. If you are looking at trading him in, will he bounce back? How much further will he fall? Are there better alternatives? Every situation throws up different circumstances, that need to be considered as a whole, rather than just isolating it down to player A.
I actually spent a big chunk of the off season researching this exact thing. I wanted to know, if there was a percentage price drop, or an actual price point, that once a player fell below that, they rarely bounced back. The bottom line is, the simple answer is no, there isn't. I'd love to be able to say "I found out, that once a player drops 25% in price, they rarely bounce back", but I can't. Each players Tipping Point needs to be assessed on the circumstances that prevail that week.
Let me give you an example of a Tipping Point I used in my team last season. Like a lot of Coaches every season, I had Ruck problems last season. The first one was Jacobs. He started off the season ok, with 102, 105, 106. Then trouble hit, his next 2 scores were 77 and 66! His opening price was $546.3k and he now sitting on $498.4k with a B/E of 154. I had seen a bit of his previous 2 games, and he just didn't seem to be getting to contests like he did in 2012. Was he carrying an injury? I saw him go to the bench late in round 5, and he looked pretty ginger sitting down. In my mind, he was gone from my side the minute I saw that. He was facing Hawthorn in round 6, and I didn't like his prospects of bouncing back against them. IF there was a suitable replacement available he has reached his Tipping Point. The point where you trade him out now, or you are nearly stuck with riding him out. Even if he managed to score 100, he'd lose around $23,800 in price, and have a B/E of 118 the next week. It seemed more likely, the way he was moving, that he'd score another score around 70. That would see him drop around $37,000 and have a B/E of 140. He was potentially in freefall price wise. Who was available going to round 6? I didn't think I could risk him having two more sub 100 scores, and dropping to around $420k. There wouldn't be much of anyone available at that price, so I'd need to do 2 trades to fix the Jacobs problem. I could straight swap to Griffen or Roughead, though I wasn't in love with either of them. Imagine how bad the choices would be if I waited a week! Luckily for me, Gawn had just played his 2nd game. with scores of 97 and 66 he was priced at $115.9 and had a B/E of -97. I actually was of the opinion he would score at a similar level to Jacobs in the coming weeks, and rather than bleed cash, would make money. You can see what I mean about him being at the Tipping Point. Act this week, and have the choice of Griffen or Roughead, or get some cash with Gawn. If I wait one more week, Gawn's bubble was gone, and if I wanted to sideways I could only pick between Bellchambers and Hale! I went with Gawn. I made $382.5k on the deal, which I used the next week to upgrade a Rookie to Swan (from memory). Jacobs next scores were: 66, 75, 101 and 36. Once that 36 had cycled through his pricing, he had bottomed out at $383,2 in round 11. Meanwhile, Gawn scored 53, 88, 18, 39 and his price had risen to a paultry $236.1k. Fortunately, I avoided his 18 and 39 scores, as I had brought NicNat in 2 weeks later, and Gawn was now on my bench. Boy! I used a lot of trades on Rucks last season! While I played Gawn, he scored exactly the same as Jacobs, but I made enough money to get Swan. So I guess it was a win.
The bottomline is, he hit his Tipping Point, sell him, or ride him out. The Coaches that held him past that week were pretty much stuck with him! Or they had to use 2 trades to fix him. It is impossible to quantify the Tipping Point to a percentage or formula. What if Gawn wasn't on the bubble? What if it wasn't Roughead and Griffen that were available to sideways to, but Bellchambers and Hale? Each circumstance has to be weighed up on the available alternatives.
As to trading in fallen Premiums, and knowing which ones to avoid, that is a similar situation. You need to identify why their price has fallen. In 2011 Watsons price fell midseason as he carried a niggle for a few weeks. There is also the famous 2 seasons in a row concussion price drops for Priddis. Sometimes it can just be the draw, and that player has just come through a tough patch. If you can identify a decent reason, then it's all systems go. If you can't, you need to look at the alternatives, and weigh up the risk versus reward. You can't identify why he has dropped, so what are the chances he'll bounce back? Generally, if you can't identify the reason for the drop, I'd only back players with a proven history to bounce back. One breakout season is not a proven history.
I hope this answers your question properly. It's a very long answer if it hasn't. I can't tell you how many hours I used in Novemeber and December trying to make this a quantifiable problem!