Surplus value calculations of the Greinke trade

[Enscheff]

clvclv made another typically proud anti-intellectual comment regarding the Greinke trade:

Couldn't help myself...
Sure looks like Luhnow *hit all over those value charts today - those explanations sure ought to be interesting.
Was anybody traded today not an overpay???

I promised a breakdown:

Hey the derp master himself makes an appearance.

I’ll do a surplus value calc for you later, though you won’t be able to follow

so here it is...not that he will understand.

https://www.mlbtraderumors.com/2019/...ke-astros.html

The Astros still owe Greinke ~$53M over the next 2.5 season. In those seasons he is projected to produce the following wins:

2019: 1.3 (doubled to 2.6 for contender's premium)
2020: 4.5
2021: 4.0
Total: 11.1 WAR

Multiplying that 11.1 WAR value by $9M per WAR over the next 2.5 seasons yields a positive value of ~$100M.

Subtract the ~$53M he is owed by the Astros, and you get ~$47M in surplus value.

Let's take a look at what the Astros gave up using values from the following tables:

https://blogs.fangraphs.com/an-updat...ect-valuation/

https://blogs.fangraphs.com/putting-...e-the-top-100/

Martin RHP: FV 50 = ~$21M
Buk RHP: FV 50 = ~$21M
Beer 1B: FV 45 = ~$6M
Rojas 3B: FV 35+ = ~$0

Total: $48M in prospect value

Notice the values in bold are almost exactly equal?

One more tidbit:

"A third of his salary in 2019-21 is deferred and will be paid out in annual payment of $12.5MM from 2022-26, thus reducing at least some of the immediate financial implications for Houston."

Deferred money carries a lower present day value, so the Astros are actually paying Greinke less than the $53M they owe him on paper. Therefore, they actually came out a little ahead by the surplus value model.

So there you go clvderp...surplus value model holds up just as well as ever despite your complete inability to understand it.

Deeerrrrppppp!!