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Risk equivalence as an alternative to balancing mean value when trading draft selections and players in major sporting leagues

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Tuck, GN and Richards, SA ORCID: 0000-0002-9638-5827 2019 , 'Risk equivalence as an alternative to balancing mean value when trading draft selections and players in major sporting leagues' , PLoS ONE, vol. 14, no. 5 , pp. 1-15 , doi: 10.1371/journal.pone.0217151.

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Abstract

In sports leagues that use an annual draft to assign eligible players to clubs, having a valueassociated with a draft selection can allow clubs to anticipate future growth of players and, ifa trading period exists, assist negotiations when exchanging draft selections and players.Typically, mean draft values often decline in either an exponential or geometric manner withincreasing draft selection number. Aggregate mean values have been used to comparetrade packages. However, clubs may also want to ensure that a trade does not increase theprobability of obtaining poor players in the draft. This paper therefore considers equivalenceof risk as an alternative trading strategy for club list managers. Here, risk is defined as theprobability of the aggregate value of the received draft selections being below a minimumacceptable level. For risk equivalence, a premium over and above mean market value mayneed to be provided when trading to secure higher draft selections.

Item Type: Article
Authors/Creators:Tuck, GN and Richards, SA
Keywords: risk, Australian Rules Football, draft
Journal or Publication Title: PLoS ONE
Publisher: Public Library of Science
ISSN: 1932-6203
DOI / ID Number: 10.1371/journal.pone.0217151
Copyright Information:

Copyright 2019 Tuck, Richards. Licensed under Creative Commons Attribution 4.0 International (CC BY 4.0) https://creativecommons.org/licenses/by/4.0/

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