Today's trade of prospect Connor Graham for Cleveland Indians reliever Rafael Betancourt brought to the forefront of my mind a new tool that was developed by Sky Kalkman of Beyond the Boxscore: the Trade Value Calculator.
Basically, Kalkman has developed a fantastic spreadsheet that, using contract data from Cot's Contracts as well as WAR from Fangraphs--the calculation of which I explained for hitters and pitchers--derives a player's total value to his team now and in the future. I also explained previously how WAR is turned into a specific monetary value. Kalkman's methodology is well-explained in his post and the spreadsheet is available to download.
The problem with this calculator is that future WAR is in the eye of the beholder, so to speak--it has to be projected using historical data over the life of the contract, making it difficult to value young players. It also makes the entire process pretty speculative, but then again, if I could accurately predict the future I would be a very rich man. It is a fun exercise to see what kind of value the Rockies have on their major league roster.
In order to demonstrate the superb utility of this spreadsheet, I'll break down the trade today using the Trade Value Calculator:
In valuing the 34 year old Betancourt, I conservatively forecasted his WAR for the rest of this year as equal to his contributions with the Indians this year (0.4 WAR). Why is this conservative? Because Betancourt will get the bump in his numbers that corresponds to his switching leagues and will therefore likely produce at a higher level for Colorado.
For his 2010 $5.4 million option year, which the Rockies won't likely pick up, I projected Betancourt's WAR using a simple average (career WAR (8.4) / ML service time (5.079)) to get 1.5 WAR as a target for 2010. If the Rockies do decide to decline the option, offer Betancourt free agency, and take the Type B compensation picks they'll get roughly $2.5 million in value, as Victor Wang explains.
Here's what the trade calculator spit out as Rafael Betancourt's value:
|Year||Sal (M)||WAR||Val (M)||Net (M)|
Basically, keeping Betancourt for 2010 nets the Rockies $2.4 million while jettisoning him after this year would net Colorado $3 million in value. As a trade asset by this method of valuation, Betancourt was worth $4.9 million as a trade asset to Colorado--to be traded again or held.
Valuing Connor Graham is more difficult--after all, he has no big league track record. Luckily, others have done that legwork (Victor Wang in particular) and we have a serviceable definition of the future value of prospects. Erik Manning of BtB does an excellent job of translating Wang's research into a readable table of prospect future value (with a more full explanation here).
This table is largely based upon John Sickels' (of SB Nation blog Minor League Ball) rankings. Sickels ranked Connor Graham as a B-/C+ prospect (fifth in the system overall) going into 2009. Using Manning's chart, this differentiation is rather large ($6.5 million for a Grade B pitcher, $1.3 million for a C pitcher 23 and older).
I am a little more pessimistic on Graham than Sickels is, given his likely future (and ceiling) as a setup man, so I personally value him at around $3 million--which is right around the return the Rockies can expect to receive from Betancourt. My verdict, therefore, is that this is an exceedingly fair trade--one that could be tilted either way by Graham flaming out or becoming a productive starter or even Betancourt returning to 2007 form (3.2 WAR).
Good move by O'Dowd and Shapiro, given their teams' respective prospects for this year.