Ottoneu Arbitration: A Guide for 2014

For those who have not compulsively checked their Ottoneu rosters since the end of the regular season, it may have slipped your attention that arbitration began on October 16. Well, now it’s time for that to unslip your attention. Voting or allocating – depending on your league settings – will run through November 15, and I heartily recommend that you act early and often.

There are two flavors of arbitration in Ottoneu, each with its own unique merits. Chad Young has been RotoGraphs’ arbitration specialist in the past. He’s offered helpful voting strategies, a more detailed description of the allocation process, and advice on how to use your allocations. If you need any background on the mechanics of Ottoneu arbitration, follow those links.

In voting arbitration leagues, the format is fairly straightforward and Chad does a great job describing the four basic strategies available to you. Rather than rehash his work, I recommend that you follow the first link above. If you are in an allocation league, I suggest that you at least skim the two pieces on allocation before continuing.

I enjoy the allocation system because it allows owners to pursue a multitude of strategies with a wide range of goals. However, all (rational) decisions can be bucketed into a few general strategies.

Make Your Dollars Felt Over Time: The first high level strategy is to make your dollars felt by allocating them to players who will remain keepable. Ideally, your entire $25 arbitration allotment will be tied up in keepers. If well executed, it’s possible to pollute your rivals’ rosters for multiple seasons.

For example, Josh Donaldson costs $3 to keep in many leagues and let’s say My Archnemesis owns him. If I allocate $3 to him this season and he’s kept for the next four seasons, then I have essentially forced My Archnemesis to spend $12 due to my $3 allocation. But if I successfully rinse and repeat each of those four seasons, he could end up spending a total of $30 to continue rostering all of the players to whom I have allocated resources. In year four, the burden would be $12, which is the difference between a regular and a backup.

This should be considered a default strategy since it fully leverages your resources.

(Variant) “Keep Players Keepable – But Just Barely”: This is the strategy advocated by Chad last season. Basically, your goal is to bid up cheap players until they are a dollar or two less than their expected value.

This accomplishes two things. It forces an owner to make a tough keeper decision in the subsequent season when the natural Ottoneu inflation tacks on another $2. More mischievously, it messes with a player’s mid-season trade value. An owner of a sinking team might trade a solid “win-now” player for a good, but cheap player, but they won’t trade for somebody with no surplus value.

While this strategy does not maximize the long term impact of your arbitration dollars, it can be quite disruptive and potentially more painful.

Target Players That You Want in the Draft: This is the antithesis of the above strategies and is probably best used by owners with dysfunctional rosters. Basically, you want to force more high level talent into the draft – ostensibly so you can win said talent. If you are feeling particularly tricksy, you can try this approach with a player who may spark a bidding war between your rivals. This early in the offseason, that’s a difficult strategy.

Assuming your goal is to force the player into the draft pool, you end up with a win-win situation. Either that player becomes available or his owner overpays to keep the player. The latter outcome could have fun ramifications mid-season if that owner needs to add personnel but can’t find the funding.

I have a personal use case for this strategy that nicely illustrates when it is a good idea. I recently joined FanGraphs Staff Two in place of an existing owner. The roster I inherited came in last place and features minimal keeper talent.

I could scuffle with the existing roster or aggressively attempt to reset. Because of the hole in which I find myself, I also believe that any chance of winning will require my rivals to make mistakes, and pumping elite talent into the draft offers more opportunities for those mistakes. I don’t necessarily want the players I am bidding on, but I would be happy to “accidentally” add elite talent to my roster through price enforcement.

Other Considerations: The above ideas are the general strategies that you will want to apply while allocating your arbitration dollars, but there are other things to consider.

No matter which strategy (or strategies) you choose to deploy, owners usually have several players that fall into each bucket. How do you decide which ones to target?

1) Scarcity: Position scarcity is always an important concept to consider. Ottoneu forces owners to start a combined 36 second baseman and shortstops. Closer to 50 are rostered, excluding prospects, and only about 30 offer non-terrible stats. If you find yourself deciding between allocating to a shortstop or a starting pitcher, it is probably best to make that scarce position pricier.

2). Stability: In general, the different positions have different degrees of stability. Usually, you will want to target stable assets over unstable assets. Francisco Liriano is uniformly cheap in Ottoneu, but given his history of erratic performance, it may be a waste of your money to allocate to him. He may be a $18 pitcher next season, but history tells us that he could easily offer negative value too.

Stability doesn’t just apply to specific players. Relief pitchers are less stable than starting pitchers. Starters are less stable than catchers. Catchers get beat up more easily than other position players. These may not be the best positions to target.

3). Prospects: Prospects are also a bad value proposition. Most touted prospects either bust or provide minimal fantasy value. The only reason to allocate money to a prospect is to make the pain of that allocation felt a very long time. But the inherent unpredictability of prospects means that a lot of those guys will ultimately flame out before they hamstring your rival’s budget.

Even blue chip prospects like Mike Trout are not good targets. Let’s say an owner in your league had Trout for $5 prior to 2012. You and a couple other owners knew he was going to be a star so he gets bid up to $10. He then proceeds to have his monster season. Prior to 2013, everybody bids their $3 on Trout, pushing him to $10 + $2 (Ottoneu inflation) + $33 (arbitration) = $45. A few more bids this offseason and he’s back in the draft pool.

4) Allocating Your Resources: Because you have $25 to spread across 11 rosters, you also need to decide how you want to allocate your resources. I advocate taking a short view by targeting the owners who are most likely to compete in the following season. I never enter a season aiming to rebuild, which means attacking and disrupting those owners who pose the greatest threat to me.

Alternatively, you can allocate your arbitration money based on whichever general strategy you are following. For example, if you decided on a funky strategy of building an elite bullpen, you may want to bid up Craig Kimbrel, Aroldis Chapman, and Kenley Jansen, even if the respective owners aren’t much of a threat.

5) Collaborating: One final consideration (but by no means the final consideration) is the nature of the allocation process. You can see how many dollars have been allocated to each player in the “Arbitration Allocations” tab. This allows you to semi-collaborate with other owners. If you see that Edwin Encarnacion has been bid up too high since you made your initial allocation, you can instead target another player. You will want to monitor changes in the bidding closely, especially as the November 15 deadline approaches.

This brief guide to allocation strategies only scratches the surface of what is available to you. Hopefully the included content will get your creative juices flowing. With a little luck and effort, you’ll have your rivals cursing you in their sleep. Enjoy arbitration season.

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Brad is a former collegiate player who writes for FanGraphs, The Hardball Times, RotoWorld, MLB Trade Rumors, and The Fake Baseball. Follow him on Twitter @BaseballATeam or email him here.

12 Responses to “Ottoneu Arbitration: A Guide for 2014”

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  1. LarryA says:

    The hardest part is what to do with cheap keepers who you want to try to trade for.

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    • Brad Johnson says:

      Feel around to see if there is mutual interest. If you know another owner wants your elite pitching, let him know you’re looking to trade for one of his cheap keepers and then use your allocation on a player that you don’t want. That will also keep him from bidding on the player that he wants.

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  2. mschieve says:

    If you’re in an Ottoneu league, what is your opinion on auctioning talent that was recently added (read: Kris Bryant, Mark Appel, Jonathan Gray)?

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    • Brad Johnson says:

      I prefer prospects who are close to the majors. If any are on the fast track like a Harper or Strasburg, then I’d absolutely target them, but those types tend to cost a bit much. If a player is going to take 4+ seasons to reach the majors, then I’d never drop more than a $1 for them – and then only to re-sell them as rapidly as possible.

      That’s just my own personal preference. I’d rather trade my expensive talent for near MLB prospects after my roster falls apart than nurture them for multiple seasons.

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  3. Cardinology says:

    I couldn’t agree more on the point on Liriano. I’m not planning to bid on him for that exact reason.

    I don’t agree on the point about prospects, however. With your Trout scenario, you seem to be saying “he’ll just get bid up next year, so don’t worry about it until then.” Why not put an extra dollar or two on someone like Bradley or Buxton a year early? His owner will keep him, which satisfies the “make your dollars felt” strategy (which happens to be my strategy). It will take less dollars the next year then to pump the player’s value up to where it should be.

    Puig’s owner had him in our league for $3 or $4 and even though his price will be driven up this year, it means any other cheap keeper candidates on that team will not get as much attention and he’ll get another year to keep them at very cheap prices. Not that Puig was as clear of a stud prospect as Trout, but I think there’s a benefit to just putting a little extra on a super elite prospect early on.

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    • Brad Johnson says:

      Maybe I shouldn’t have used the Trout example since he’s a once in a generation prospect. Players don’t go from $0 to $60 very often.

      Bidding on prospects is an uncertain practice by nature. You could get lucky and have your dollars be felt over 6 seasons but it’s more likely that the player is back in the draft pool after 1-2 seasons.

      For the purposes of Ottoneu, I aggressively discard prospects. They tend to cost somewhere around $15 over 2-3 years before they even play one game. Then that first season is usually a bumpy ride due to performance, playing time, or both. Then the allocations roll around and your $7 prospect now costs $14 with a $20 ceiling and -$5 floor.

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  4. ahix24 says:

    One hidden risk worth mentioning for the Target Players to Draft approach, it seems to me, is allocating dollars to players that are likely to be dropped anyway. You’re essentially giving that owner a free pass on salary that they may have been forced to carry next season if allocated to one of their actual keepers.

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    • Brad Johnson says:

      It’s definitely a risk and one I could have stressed more. If you’re trying to do it purely with your $3, then you have to target players who may already have been on the chopping block.

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  5. LuckyStrikes says:

    Just asking an honest question why this arbitration process occurs before the keeper deadline? Would it make more sense for arbitration to occur between the keeper deadline (1/31) and say March 1st? Lots of trades happen in the off season and a player’s value can sometime change based on what happens in MLB during the off season (is D. Price more or less valuable as a TEX Ranger?), so wouldn’t we be armed with the more information to make allocations after the keeper deadline?

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    • byron says:

      Because Niv thinks it makes more sense to let arbitration results influence keeper decisions than for keeper decisions to influence arbitration results, and that keeper decisions are more important and deserve more up-to-date information than arbitration decisions. I 100% agree with him, and would bet that almost everyone who plays does too. Not sure why you think arbitration allocation is more important than keeper decisions.

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      • Brad Johnson says:

        To build off this comment, LS’s suggestion really doesn’t work for the allocation method. It does work fine for voting but I’m pretty sure most leagues use allocation now.

        Let’s say a team has 12 keepers and they all happen to cost $5 under their expected value. Doing allocations early may drub out a couple of those options. An owner could decide that he’d rather cut a decent OFer at cost and get someone cheaper in the draft. He could anticipate that desire, but then he’d keep 11 players and his rivals would get to spread their money around to fewer players. It also opens up some mean spirited strategies.

        On the other end of the spectrum, I mentioned that I inherited a very bad team in Fangraphs Staff 2. I anticipate keeping between 3 and 6 players when all is said and done. However, my roster has plenty of marginal values that people are bidding on even though I don’t plan to keep them. Without that smoke screen, I would be doubly punished for having a bad roster.

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      • sukjo says:

        I like the “smokescreen” strategy that Brad mentions. I did the same this year – rather than cut a handful of borderline players that, to me, become overvalued simply by inflation, I kept them around hoping they would attract arbitration dollars, and so far they have!

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