CSS Button No Image Css3Menu.com

Baseball Prospectus home
  
  
Click here to log in Click here for forgotten password Click here to subscribe

<< Previous Article
Premium Article Skewed Left: Saber Sem... (08/21)
<< Previous Column
Fantasy Article Fantasy Freestyle: Wee... (08/21)
Next Column >>
Fantasy Article Fantasy Freestyle: Adj... (08/22)
Next Article >>
Fantasy Article Fantasy Starting Pitch... (08/22)

August 21, 2014

Fantasy Freestyle

Information, Humans, and Errors in Valuation

by Jeff Quinton


Seemingly out of nowhere, it has become “I was wrong” season for the Baseball Prospectus fantasy team. First, Craig Goldstein wrote about undervaluing Starling Marte, and then J.P. Breen wrote about undervaluing Yovani Gallardo. Both articles do an excellent job analyzing what each author missed regarding the specific player. What I hope to look at today is not what was missed about a specific player, but rather what parts of human behavior cause us to err when forecasting player production.

In order to do so, let us take a look at forecasting and what humans do when forecasting. My favorite definition of forecast (the verb) is from Merriam-Webster and it goes, “to predict after looking at the information available.” I like this definition because it is convenient for my article. I also like it because it highlights that our forecasts are dependent on “the information available.” Relatedly, in Thinking, Fast and Slow, our main human, Daniel Kahneman writes, “An essential design feature of the associative machine is that it represents only activated ideas.” Put differently, we cannot take into account that which we cannot imagine. I am throwing around a lot of combinations of words right now, so please allow me to simplify all this:

When forecasting, we often limit ourselves to using the information available and what we are able to imagine.

Whether we undervalue or overvalue a player, we often do so because we underestimate the chances of an unexpected outcome. The consequence of this is thus overestimating the chances of an expected outcome. Usually this mistake has zero negative consequence because expected outcomes are more likely to occur than unexpected outcomes. However, the more frequently we make this mistake, the greater our chances of being on the wrong side of an unexpected outcome.

Based on what I have observed, underestimating the chances of an unexpected outcome manifests itself primarily in two ways in fantasy baseball: (i) overestimating perceived trends and (ii) overestimating rookie performances. These errors are then compounded when combined with (iii) confirmation bias.

1. Overestimating perceived trends
Our brains love trends and patterns. In fact, they are wired to not only recognize trends, but to create them. This is often a good thing (for instance, in recognizing a threat, such as a drunk driver), but can often create blind spots. We often see this in the veteran discount for older players who many fear will cease to be productive; or in the premium paid for prospects based on the assumption they will continue to linearly improve. We also see this with the price paid for consistency, or perceived consistency; for example, the player who you can bank on to play 160 games until you cannot.

The rest of this article is restricted to Baseball Prospectus Subscribers.

Not a subscriber?

Click here for more information on Baseball Prospectus subscriptions or use the buttons to the right to subscribe and get access to the best baseball content on the web.


Cancel anytime.


That's a 33% savings over the monthly price!


That's a 33% savings over the monthly price!

Already a subscriber? Click here and use the blue login bar to log in.

Related Content:  Fantasy

3 comments have been left for this article. (Click to hide comments)

BP Comment Quick Links

Nacho999

Can't argue with any of the glowing forecast points on Danny Salazar...I too, got hornswoggled into thinking there was no way this guy doesn't win 12-15 games and be a huge asset to my fantasy team...Compounding my issue is I own him cheap in a long term keeper league so I couldn't just cut him because I still believe he'll produce next year, but having three players like him in Michael Pineda and to a lesser extent, Drew Hutchison, just torched my pitching staff this year...Throw in starting out the year with Ivan Nova and Masahiro Tanaka (don't forget rock solid closer Joe Nathan!) and now non-closer Joakim Soria and my numbers begin to make sense...Injuries are part of the game for sure, but it wouldn't surprise me to see Salazar, Hutchison and Pineda to combine for 40 wins next year with nice peripherals rather than the 14 I'm currently saddled with...I didn't know Tanaka was an ace, but I could have gotten by with my ace-less staff that also included Dickey, Quintana and Cobb if those other three had performed...I'm going to finish second in all probability, but I feel like I could have and should have won going away...And now Soria and Tanaka will no doubt pitch brilliantly for another team in my league next year as a result of those other three too...Don't Believe, Don't Believe, Don't Believe The Hype...

Aug 21, 2014 13:39 PM
rating: 0
 
ChicagoOriole

There is a fascinating comment in a recent edition of Science magazine (the AAAS publication) on statistics. Perhaps controlling for many possible hypotheses is in order?

"The future lies in uncertainty" D. J. Spiegelhalter
Statistical Laboratory, Centre for Mathematical Sciences,

"Traditional statistical problems could be termed 'large n, small p': There were many observations (n), such as participants in a clinical trial, but few parameters were measured (p), and just a handful of hypotheses tested. More recently attention has turned to 'small n, large p' problems...

Many such “small n, large p” problems require screening of vast numbers of hypotheses, for which the naïve use of statistical significance is inappropriate; the standard “P < 0.05” criterion means that 1 in 20 nonexistent relationships will be declared significant, so that if you do enough tests, some apparent discoveries will always pop up. Procedures have been developed to control the false discovery rate (FDR); that is, the proportion of apparent discoveries that turn out to be wrong (7). For example, the confidence required before announcing the discovery of the Higgs boson was couched in statistical terms as 5 sigma, and this assessment included an adjustment for how many hypotheses were examined (the “look elsewhere effect”).

Aug 21, 2014 17:08 PM
rating: 0
 
ChicagoOriole

Science 18 July 2014:
Vol. 345 no. 6194 pp. 264-265
DOI: 10.1126/science.1251122

Aug 21, 2014 17:09 PM
rating: 0
 
You must be a Premium subscriber to post a comment.
Not a subscriber? Sign up today!
<< Previous Article
Premium Article Skewed Left: Saber Sem... (08/21)
<< Previous Column
Fantasy Article Fantasy Freestyle: Wee... (08/21)
Next Column >>
Fantasy Article Fantasy Freestyle: Adj... (08/22)
Next Article >>
Fantasy Article Fantasy Starting Pitch... (08/22)

RECENTLY AT BASEBALL PROSPECTUS
Fantasy Article Deep League Report: Week 13
Premium Article Field Generals: Under Pressure
Premium Article The Prospectus Hit List: July 1, 2015
Premium Article What Scouts Are Saying: July 1, 2015
Premium Article Going Yard: Futures Game: USA Bats
Premium Article Minor League Update: Games of Tuesday, June ...
Premium Article Notes from the Field: July 1, 2015

MORE FROM AUGUST 21, 2014
Premium Article Skewed Left: Saber Seminar One Year From Now
Eyewitness Accounts: August 21, 2014
Pebble Hunting: You Lie!
Premium Article What You Need to Know: August 21, 2014
Fantasy Article Fantasy Freestyle: Week 21
Premium Article Minor League Update: Games of Wednesday, Aug...
Fantasy Article TTO Scoresheet Podcast: Episode 32

MORE BY JEFF QUINTON
2014-09-02 - Fantasy Article Interleague Report: Week 23
2014-08-28 - Fantasy Article Fantasy Freestyle: Analyzing the Competitive...
2014-08-25 - Fantasy Article Interleague Report: Week 22
2014-08-21 - Fantasy Article Fantasy Freestyle: Information, Humans, and ...
2014-08-18 - Fantasy Article Interleague Report: Week 21
2014-08-11 - Premium Article Interleague Report: Week 20
2014-08-07 - Fantasy Article Fantasy Freestyle: A Strategy Example From t...
More...

MORE FANTASY FREESTYLE
2014-08-28 - Fantasy Article Fantasy Freestyle: Analyzing the Competitive...
2014-08-25 - Fantasy Article Fantasy Freestyle: Weak Links
2014-08-22 - Fantasy Article Fantasy Freestyle: Adjusting for Era
2014-08-21 - Fantasy Article Fantasy Freestyle: Information, Humans, and ...
2014-08-21 - Fantasy Article Fantasy Freestyle: Week 21
2014-08-20 - Fantasy Article Fantasy Freestyle: Being Wrong About Yovani ...
2014-08-15 - Fantasy Article Fantasy Freestyle: Starling Marte and Being ...
More...

INCOMING ARTICLE LINKS
2015-06-10 - Fantasy Article The Quinton: Intuition and Decisions About t...
2015-01-30 - Fantasy Article Fantasy Players to Avoid: Third Basemen