Week 2 has concluded, bringing with it injury carnage, bounceback weeks, and everything in between. Last week, I went over how to systematically process new information without being reactionary. This week, I’ll explain how to use that information to trade sharply.
Value Proposition
In general, there are three ways you can swing a trade, assuming you aren’t overpaying.
1. You and your trade partner have different goals.
2. The consensus is behind/late on a player or asset
3. Your trade partner is mispricing a player or asset
When you send an offer, you should recognize which of these you’re relying on, as it affects the kind of trade offer you send, and whether the other owner will take your offer seriously.
Different Goals
This is by far the most important difference between dynasty fantasy football and redraft. In redraft, everybody has exactly the same goal, and trades require somebody to make a mistake; they’re a zero-sum game.
Dynasty is such a richer and more immersive game precisely because not all owners are prioritizing the same goals at the same time, and you have a currency in the form of draft picks that greases the wheels of commerce.
This is a topic for a different article, but many of the best trades I’ve made in dynasty have all been the result of identifying the highly motivated sellers in my league and identifying their needs. Trades in dynasty can be a win-win.
While this may sound obvious, in practice we lose sight of this all the time. Dynasty content creators are obsessed with winning and losing trades, when in reality it’s much more important to correctly identify where your roster stands, and who the most natural trade partners in your league are.
Mispricing
If your trade partner is not motivated to sell a particular player, you can still trade without overpaying if the player is mispriced. This can happen either if the consensus is behind on a player, or if your trade partner individually is mispricing a player.
To judge when the consensus is behind on a player, it all comes back to last week’s article. Essentially, the underlying data needs to differ from the results enough to create a mispricing, and also the signal from this data cannot already be priced in by the dynasty community.
Additionally, you should pause to think about whether the consensus is *wrong* or *late*. If you think it’s late, that’s a very reasonable opinion, and you can frequently buy ascending players early. Parker Washington was probably available for a 2nd+ in many leagues this offseason, as an example.
If you think the consensus is *wrong*, you need to be extremely disciplined as an owner. Pause and ask yourself if this truly is one of those cases where you’ve spotted something others are missing, or mispricing. Don’t get me wrong, the consensus can sometimes be very wrong, and herding is a real issue in the community, so your answer genuinely could be “yes”. To figure out if this is one of those cases, ask yourself what evidence is supporting your opinion, and how specific a series of events has to go right for you to be proven correct.
If instead you’re hoping a specific owner is mispricing a player, this can be incredibly hard to judge ahead of time. There are two solid ways to get a better sense of who your leaguemates might be mispricing, but it takes a lot of discipline and work to stay on top of this.
First, you should periodically check the transaction histories of all your league mates and check if they systematically overvalue/undervalue specific position groups or types of assets. Some owners have a tendency to trade away their future draft picks even if their roster isn’t going anywhere. Others might overvalue FAAB, even in deep leagues where FAAB is nearly useless. Still others might love rookie contract players, even the bad ones. You need to notice and remember these patterns.
The other way to stay on top of potential mispricings is by checking in on your leaguemates in the DMs. Actually talk to them and ask them if certain players might be available, and what they’d be looking for in return. Figure out who on your roster they really like. Casual conversations can be revisited months later as serious trade talks.
How to Avoid Bad Trades
Don’t Get on the Hype Train at the Last Station
As a dynasty owner, you need to be disciplined enough to pause and think about whether your motivation for doing a trade is already priced in. No matter how much the metrics might be supporting a player breakout, it’s rarely a good idea to buy a player once the entire community has caught on.
In general, you need to be able to identify when a player’s value is based more on goodwill and hype than production, and when he’s being priced at his ceiling. And you need to fight the fear of missing out that’s tempting you to pony up for that player.
This does not, I repeat, this does *not* mean to sell your players when everybody catches on that they’re good. It just means you need to know when you’re already too late to buy that player.
Take Colston Loveland and Luther Burden as examples this year. I am absolutely not selling my Loveland shares, and I’m not going to pretend I ever advised people to sell high on him. I’m going down with that ship to the bitter end. However, there came a point fairly early in the offseason where it became impractical to buy him.
You need to identify when the hype train has crossed the Rubicon on a player. Sometimes, it’s too late to buy a player, and you need to accept that, regardless of whether you think you have too few shares of them.
Overall, you will have more failures than successes if you buy players at the very end of the hype train, which goes back to the concept of pricing in. If you’re excited about a player for the same reasons as everybody else, and it’s become a self-reinforcing feedback loop across the industry, the only way you’ll acquire them is by overpaying.
Does the Trade Fit Your Roster
By far my biggest gripe with dynasty content creation is the obsession with “value wins”. I’m a much, much bigger proponent of identifying what direction you want to take your roster, and acquiring players and assets that take you in that direction with laser focus.
If you’re trying to scalp players who you aren’t actually interested in rostering, you’ll run into a couple key problems.
First, and most important, is opportunity cost. If a player doesn’t make sense for your roster, or if you don’t really want them except you think they’re undervalued, then whatever assets you’re using to acquire that player should have been used to further your roster-building goals.
Second is liquidity, or the lack thereof. Even if you get an objective value win when acquiring a player, there simply might not be owners in the league who then want to acquire that player from you. He might not make sense for their rosters, or they may not think he’s worth the opportunity cost to acquire the player. Profits that only exist on paper do nothing for your dynasty team.
Could the Trade Require Damage Control
Some trades are disproportionately likely to cause follow-up mistakes down the line. Here are a couple examples:
1. Trading an irreplaceable player away. A year later you’ll look at your rebuilt roster and think, “man, I’d love to package some of these assets for a stud.” Usually, if you were too gung ho about selling those stud players, you’ll pay more to acquire them than you got in the sale. The one exception is if they’re genuinely too old for you to hold.
2. Trades that leave you without depth when you’re competing. Almost guaranteed you’ll be making bad waiver claims and slightly unhinged trade offers for depth pieces as soon as injuries hit.
3. Trading away your own first-rounder too early. When these trades go wrong, they invariably lead to somebody overpaying to reacquire their pick, or to them making bad follow-up trades trying desperately to keep the ship afloat. I almost always wait to trade away my own first-rounder until the deadline of that year. By then, I know where my team stands, and I can maximize my return by identifying motivated sellers who need draft picks.
Before sending a trade offer, think long and hard about whether you can stomach being wrong without giving up too early or compounding the error. Especially when you try to buy low on a player, can you react calmly if you see no signs of progress for the first few weeks, or will you panic sell once things get hairy? If you make a trade that leaves your roster in a precarious position, can you stomach losing the trade without chasing the mistake with additional mistakes?
There are two good ways to avoid this problem. The first is to make trades fit your roster and goals, regardless of whether you “won” or “lost” the value aspect of the trade. Even if the trade doesn’t go great, and maybe you overpaid in retrospect, you still got something out of it. For all you know, that trade enabled you to make good follow-up moves later on by solving a problem and thus freeing up your resources.
The second is to think about value insulation. If you’re trying to buy low on a player, are you buying a player that we all know is genuinely good at football, and perhaps just in a bad situation? Or, are you acquiring somebody who might be mediocre-or-worse at football and trying to make a quick profit? If it’s the latter, you won’t know what to do with that player if the trade doesn’t pay off, and it’s difficult to figure out where to go from there.
Give Yourself Outs
If you take nothing else away from this article, it should be this section. Give yourself as many different ways as possible for the trade to benefit you. Humans are not only really bad at predicting highly specific, complex outcomes. They’re also uniquely likely to overestimate how good they are at doing so.
To maximize the chances you benefit from a trade, first try to add more assets at the margins. If you’re trading away draft picks, try to get back later draft picks. When acquiring players, try to get the other owner to include a couple throw-ins, typically cheap players with potential. When acquiring a stud player, try to sneak in some unheralded depth pieces who a motivated seller might not think twice about jettisoning.
Then, when trading for an individual player, think about how many acceptable outcomes exist for that player. Do you need them to take over a backfield, which doesn’t happen quite as often as we tend to wishcast, or do you just need them to increase their playing time?
Or, if you’re buying low on somebody who had a bad previous season, you could be betting on any of the following:
1. The player might still be improving
2. Other players may leave the team and vacate targets or backfield opportunities
3. The offensive environment might improve (playcaller upgrade, quarterback upgrade, second year in the offensive system, regression after a year of negative game scripts, improvements to the offensive line, etc)
4. The player you’re buying might join a better team or leave for a bigger role (Hello, Ken Walker)
5. The player won’t miss as much time due to injuries as the previous season
6. The player will play better because they’re another year removed from prior injuries
All of these are potential reasons you might expect a player to bounce back. Ideally, you acquire players who have as many different paths to success as possible.
Conclusion
There you have it, we’ve created a systematic trading strategy to take advantage of major changes in dynasty values early in the season.
First, you need to figure out why you suspect a trading opportunity exists, be it because the consensus is slow (or maybe wrong), or a specific owner has tendencies you can exploit. Be honest with yourself about what signals you’re reacting to, whether they’re already priced in, and whether they’re truly relevant and important.
When deciding which players to buy or sell, keep your eye on the ball. Decide where your roster is going, and keep working towards that goal without getting caught up scalping vacuous player values. In doing so, you’ll avoid some of the key pitfalls that afflict dynasty owners. In particular, avoid making trades that will require additional damage control if they don’t go well.
Finally, give yourself outs. Increase your “luck surface area” and prioritize trades with lots of distinct paths to working out for you. Practice all these tactics together, and you’ll be able to trade sharply and decisively without being reactionary.