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Dynasty: Learn the Trade

Closing a dynasty trade is like smashing a perfect drive, 300+ yards straight down the middle.  It’s a rush.

Unfortunately, it can be as rare as a unicorn.  Because on the next hole, your shot slices off into the woods.  You try and replicate your grip, your stance, your $%#@’n head movement, whatever – none of it works.  What gives?

Same story with dynasty trades – you keep putting out attractive offers, but no bites.  Why?

For starters, most of us follow the same strategy formula for dynasty and keeper leagues as redraft.  In redraft, we seek some statistical or informational edge on analyzing players to incrementally improve our roster before the playoff clock ticks down to zero.  Most analysts (yours truly included) whom you rely upon start off playing and reading redraft.  So, most dynasty analysts evaluate players like redraft and simply add an age premium for trade value.  It’s two-dimensional thinking instead of one-dimensional thinking.

Better, but not good enough in today’s over-information age.

Scott Fish stated in a summer podcast episode that there’s very little difference between “expert” fantasy players and everybody else.  We all have Rotoworld on our phones.  We all have access to the same ocean of player information.  Plus, in dynasty, these incremental improvements we make to our rosters which are viable in redraft might not be applicable in two, three, or four years.  Situations change.  Player skillsets change.

So, where can we gain an edge that nobody else sees?

The Third Dimension of Dynasty Strategy

Bottom line: in order to close worthwhile trades, we need to step out of our 2D comfort zone and think three-dimensional chess instead of checkers.  Rather than focusing 100% of our time analyzing the same player micro-valuation questions as everyone else, what if we spent even 10% of our time evaluating our league mates?

After all, we’re in dynasty leagues with these same people for many years (hopefully).  What if you could understand what makes your opponents tick, and in turn predict their behavior? (This applies to redraft too, but dynasty players have a wider range of goals and objectives than winning this year, so it facilitates more paths to trades).

We can execute this strategy by embracing a tiny sliver of the investment world known as behavioral finance. It’s the science of mapping and working around people’s investment and trading biases.  It will lead to more trades.  More trading builds more trust.  More trust means better deals.

What’s more, you can put this skillset to work immediately.

Skeptical?  After all, it all sounds awfully self-helpy, doesn’t it?  No worries – no confidence firewalks are required at the end of this article.  Probably.

Be Cool

This article isn’t a how-to manual on how to fleece your opponents.  Unlike caper movies, that doesn’t work in real life.  If it works in your league, then you’re in a dumb league and you’re beating the game with an invincibility code.  Congrats.  No, in order to build trust, you need to be ethical and fair.  If that sounds Boy Scout-y, keep in mind that publicly traded companies with a high ethics rating have consistently outperformed the market.

And actually, graduating from mostly zero-sum rock-paper-scissors trade cycles to closing deals that are good fits for both sides starts with a simple rule: determine your league’s collection of investor personalities.

How?  Well, they’ll be happy to tell you, because Rule #1 in life is that people love talking about their fantasy teams.

Read the Room

Send an email to a league mate and set the subject line as their team name.  Use the following for the body of the email:

“So what do you think about your team?  Are there any players or positions you may be looking to improve?  I don’t have any specific trades or proposals in mind – I’m just curious on the direction you’re looking to take your roster?  Thanks.”

Their answer will fit them into one of the five categories depicted below.

For instance, those that respond with some version of “No one is off-limits for the right price” are called Tourist Traps.  Unless you’re a gift shop junkie who buys “What happens in Vegas…” t-shirts for $34.99, ignore the Tourist Traps in your league.  Those that either don’t respond or say that they like their team as it stands are called Guardians.  Guardians are probably either not fully engaged in the league to start with (every league has “that guy”), or their team is a championship-caliber roster that they don’t want to change up anyway.  It always helps to keep an open dialogue, but limit your time and efforts with these two types since nothing will likely materialize here.    

These are the hardest two types to trade with.  The other Trader Personality Profiles are more fruitful:

TRADER PERSONALITY PROFILE MAP

Source:  Adapted from Bailard, Biehl, and Kaiser model

The Tourist Trap seeks to acquire assets at a favorable price and “win the trade.” You’re probably a Tourist Trap if you open negotiations at 70 cents on the dollar and your roster is full of high-efficiency players.

The Terminator identifies an asset and goes for it. If you don’t mind overpaying for “your guy” and your teams across all of your leagues overlap with a lot of the same players, then your home address is Skynet’s HQ.

The Guardian is more concerned with protecting her assets than growing them. You’re likely a Guardian if you find incoming offers more of a nuisance than an opportunity and your roster has a lot of veteran name value.

The Hustler is by far the most active on the trade market. Players/picks you acquire today are always on the market and ready to be dealt for a profit tomorrow.  You also like to squeeze that extra throw-in player or round swap into each offer.

The Straight Shooter is some mixture of the above four TPPs. Most of your trades start close to the finish line, and you appreciate fair offers even if the transaction doesn’t materialize.

So, enough with the theory.  Let’s get on with the actionable intel, you say?  Right on.

Trading with a Straight Shooter: 

Those league mates that respond to your opening “I want to hear all about your fantasy team” email with a positional analysis of their own rosters are Straight Shooters.

Adopt a Terminator mindset.  If the Straight Shooter has a player you really want, extend an olive branch by making a strong initial offer.  Straight Shooters are well-informed with a good sense of player value and roster construction, and they have no problem rejecting poorly thought out offers.  Come in strong to cater to the Straight Shooter’s sensibility.  Even if the trade doesn’t work out, you’ll earn the Straight Shooter’s respect for being fair, which can lead to more talks down the road.

Trading with a Terminator: 

Those that respond to your email by naming specific players on your roster are Terminators, at least regarding those players.

When facing a Terminator, adopt a Tourist Trap mentality – counter his offer with 80 cents on the dollar, then practice patience and hesitation and wait for the Terminator to negotiate against himself.  Remember, the Terminator is impatient and doesn’t mind overpaying for “his guys” and won’t hold it against you if you play hardball on the price.  The Terminator gets his guy (or pick), you turn a profit, and it’s a win-win.  These Tourist Trap/Terminator trades often spark bewilderment or even outrage among your league mates as it’s usually viewed as lopsided in your favor.  Ignore the noise.

Trading with a Hustler: 

You already know who the Hustlers are in your league, but a reply that includes a trade offer will confirm it.

Be the Straight Shooter and stand your ground.  Don’t fall for taking a loss on a trade with a Hustler unless it’s the final piece to bring your team to a championship.  If the Hustler threatens to trade that player or pick elsewhere, that’s fine.  The Hustler has the memory of a goldfish, so favors you grant him via giving up a future pick swap or throw-in player will be forgotten and not repaid.  Be fair, be disciplined, don’t succumb to FOMO, and let the right deal come to you.

Trading with Tourist Traps and Guardians: 

Don’t do it.

Doctor Dynasty

Let’s pivot here and consider that Jerry and Newman have the same disease with identical life circumstances.  Jerry’s doctor says, “Jerry, I’m happy to tell you that this new drug has a 40% success rate.”  Newman’s doctor says, “Newman, unfortunately, this new drug carries a 60% chance of failure.”

40% success rate vs. 60% failure rate – the probabilities are mathematically identical, and yet Jerry has a significantly higher chance of recovery than Newman.  Why?

It’s an organizational construct in the brain called framing.  The doctor frames the new drug scenario to Jerry as a solution, so Jerry thinks positively and adopts healthy habits.  Conversely, the doctor frames the scenario to Newman as a problem.  So what does Newman do?  He thinks negatively and engages in overly risky behavior because he views himself as having nothing to lose.

So, in your league, should you be a Jerry or a Newman?

At the very real risk of running this metaphor eight miles out and six feet deep, the answer is neither.  The question was framed to set you into a black-and-white, A-or-B answer, but if you identified that technique and recognized that the party whose best off in this scenario is the doctor, you’re ahead of the game.

Are the gears turning yet on how you as Dr. Dynasty might prescribe trade scenarios to the Jerrys and Newmans in your league?

Hello, Jerry

Jerry has just won his first title.  When things break our way and we realize positive change, we become risk-averse and play it safe to preserve our success.  The feeling of turning profit results in short-term satisfaction but this decrease in risk limits long-term upside.  Likewise, if a dynasty team wins the championship, there’s no incentive for the owner to make big trades anytime soon.  Why should the owner shake things up when he’s at the top of the mountain?  We’re Blockbuster Video, dammit, why should we worry about this Netflix upstart nonsense?  You can see where this is going: when successful, we become Guardians even to a fault.   

When a league member has enjoyed success in some manner, your best bet is to cater to their Guardian sense and frame your offer as something that will reduce their risk to help sustain their success. 

Hello, Newman

Have you ever gone back to the ATM after losing all of your chips at the blackjack table?  Ever become Prince Charming to win a relationship back after a breakup?  Or maybe the player you just traded erupted for a huge game on MNF and you made a blockbuster offer in order to reacquire him?

It’s the compulsion we get when we recognize we’ve made a bad decision and our brain shifts into fix-it mode to try and walk back the damage.  How we treat risk is simply an emotional construct in our minds.  People tend to be risk-seeking after suffering losses.  We double down in order to get back to even and erase the emotional pain of regret.

In other words, when we experience loss we become Terminators.

Newman has just been told that this drug has a 60% chance of failure, and his mindset becomes a Terminator seeking to take a risk.  When a league member suffers a setback, be it a playoff berth-threatening loss, a significant injury, etc., put your Dr. Dynasty lab coat on and prep for an appointment with Newman.  Frame their situation as a problem in need of a fix, which will encourage a “nothing to lose” mentality and promote taking action.  

Patience is crucial.  When Jimmy G, unfortunately, succumbs to an ACL tear, don’t leap in that afternoon with lowball offers.  That’s obnoxious.  Instead, let the loss percolate and breathe for a few days.

Lastly, communicate in kind.

Consider a harried manager.  She’s a multitasker.  She’s direct and to the point.  Long emails get discarded.  Ramble or stutter and she’ll wave you off.

Riddle me this: if you have an idea you’d like to present to this manager, is the idea more likely to be well-received if you provide her with pertinent bullet points or a longwinded dissertation?

Now consider a pensive analyst.  He writes out long messages that are full of details, anecdotes, unnecessary commas and semicolons, and he appreciates the same level of thoroughness in return; this includes run-on descriptions with one-too-many ideas.

A short, one-line response which would suit the manager above would likely be interpreted as dismissive to this analyst; it may very well offend this person who dedicated considerable time and effort into articulating his perspective.

Point being: if they send you a two-sentence response to your original email, keep your trade talks concise.  If they text you back instead of emailing, work through text messaging.  If they write you a novel, delve into some greater analysis and give them some worthwhile information to chew on, etc.

People are most receptive to communications on their own terms.  Your chances of closing a trade increase dramatically when you speak the counterparty’s language by mirroring their communication style.

GAME TIME:

Here are a couple trade examples:

EMAIL REPLY # 1:  “I’d say anyone on my team is available for the right price.  Guys I’m interested in on your team are—”

BREAKDOWN:  Don’t know, don’t care.  “Anyone is available for the right price” really translates to “Nobody is available for a fair price,” and it signifies a Tourist Trap.  Again, it’s a “What Happens in Vegas…” t-shirt for $34.99.  Probably made in China.  Next.

EMAIL REPLY # 2:  “I will say that Antonio Brown would require a haul to give him up. He’s my best asset and I’ve received a couple very lame offers for him. I would likely be looking for at least a top RB and a 1st in some sort of deal for him.  I’m really weak at RB.”

BREAKDOWN:  The fact that he comments on receiving weak offers and analyzes a positional weakness indicates this owner is mostly a Straight Shooter.  We know that Terminators can deal effectively with Straight Shooters.

  • If we have a Terminator mindset for Antonio Brown, come in with a strong offer.
  • He prefers to communicate with some level of detail.

ACTION:  He wants an RB.  His team was also floundering and he wants draft capital meaning he’s seemingly given up on the season and looking to the future.  There’s a good chance he’s in a mindset to take on more risk.  In other words, he’s Newman.  So in order for the Dynasty Doctor to land AB, we need to frame his situation like a problem without insulting him:

“What if I offered up James Washington, Tevin Coleman, and next year’s 1st for AB?  You’ve had some tough luck on the RB injury front and Coleman could be a feature back next year.”  He’s a Straight Shooter, so start off with a strong offer and communicate in kind by mirroring his level of detail.  Present his side of the trade as a solution by explaining how this package he’s getting can reduce the risk for his team. 

Close the show:  “AB is a stud, but JuJu is gaining market share and who knows how long Big Ben will be there?” Present what he’s giving up as a problem.  “AB is a stud” is true and it establishes that we’re not insulting his team; however, talking up JuJu and questioning Big Ben’s longevity is much like “this drug has a 60% chance of failure” with regard to planting the risk-seeking mindset seed that he has nothing to lose.   

Finish by TKO

For any MMA fans out there, imagine a match between a boxer and a wrestler: what happens when the wrestler gets dropped by a left hook?  Inevitably, he lunges toward the opponent’s legs and tries to secure a takedown.  It’s his nature.  It’s his instinct.  How the fight ends now depends entirely on the boxer:

The unprepared boxer who only hits speed bags in the gym because it looks good and feels comfortable succumbs to the wrestler’s takedown and gets punished from top position.

The boxer who took a day off from bag work to instead study the wrestler sprawls to defend and retreats to a safe range. The shaken wrestler crawls up to his feet and the boxer finishes the fight.

Point being, all of us fantasy addicts can hit the bag over and over by reading the same information as everyone else and hope we don’t get taken down.  Or, we can study our league mates, learn their patterns, and make more intelligent decisions.

I probably should’ve closed with the firewalk instead there, yeah?

Beau Noeske is a portfolio manager, Chartered Financial Analyst, author, and founder of entity wagering firm Hi-Line Sports Investment Group, LLC, which was featured in the June 2016 issue of Sports Illustrated. @BeauNoes

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