About that old trade value chart, and the Cowboys' Day 1 draft trade

The biggest criticism of the Cowboys draft came from the day 1 trade with San Francisco, in which they gave up pick 18 for pick 31 and 74.

The immediate reaction was that Dallas had "lost" the trade based on trade value charts. And that they had left players who were a value at 18 on their board.

As Mike Fisher said, they went "off their chart, off their board, off their rocker" and tweeted it was "indisputable" that they had lost the trade.

[...] according to the team’s Trade Value Chart – it is not a balanced deal.

Dallas lost that trade.

I like and respect Fisher, he has good information for the most part, and he's willing to engage with us fans. And I don't doubt that as he says he was there when the original chart was created, and knows something more about it than the average fan.

But I felt like he was really hung up on the whole trade value chart, and I got into a little Twitter exchange with him about it, pointing out that analytics-based trade charts showed Cowboys actually having an advantage in the trade.

Here's three sources:

Football Perspective

3) Dallas traded the 18th pick to San Francisco for the 31st and 74th picks

Clearly, the Cowboys weren’t high on any of the players available at eighteen; Jerry Jones even hinted as much earlier in the week. Dallas then surprised everyone by selecting Wisconsin center Travis Frederick, who had a third round grade according to Mike Mayock. As for the trade itself, the Football Perspective Draft Value Chart says Dallas received 123 cents on the dollar by trading down; according to the Jimmy Johnson chart, the Cowboys received only 91 cents on the dollar. San Francisco drafted safety Eric Reid to replace Dashon Goldson.

Winner: Both teams. The 49ers were obvious trade-up candidates, as they have arguably the most talented roster in the NFL and way more draft picks than they could use. They overpaid according to my chart, but not egregiously so, and “won” versus the traditional chart. Dallas, meanwhile, was able to add a third round pick. They probably could have used that pick on Frederick, but at least the Cowboys didn’t spend the 18th pick on him.

Chart Used: Combination of the two.

ESPN's NFC West Blogger Mike Sando looked the day-1 trades with a chart developed in 2011 by Harvard economics student Kevin Meers, which is incorporated into Sports + Numbers NFL Draft Trade Machine

Third trade

San Francisco 49ers give up: 31st and 74th picks

Dallas Cowboys give up: 18th pick

Old trade chart verdict: 49ers win. They received a pick worth 900 points for picks worth 820 points. Drake: "The team trading up (49ers) received excess value equal to .03 number one picks, 10 percent more value than they traded away."

Harvard chart verdict: Cowboys win. They received picks worth 331.6 for a pick worth 249.5 points. Drake: "The team trading down (Cowboys) received excess value equal to .17 number one picks, 33 percent more value than they traded away."

Sando comment: It's a little funny to me that the 49ers, a team fully versed in analytics, would fare much better by the old chart than by a new one. However, the 49ers use their own proprietary chart, one that might not line up with any charts used in this exercise. They needed a starting safety and got one in LSU's Eric Reid at No. 18. They also have 11 picks remaining, so they had capital to burn.

Draft Metrics (PDF)

A pretty fair deal. DRAFTMETRICS pounds the drums that you can’t lose trading down within a Value Group.

Fisher insisted that he had a facsimile of the actual chart that the Cowboys were using, and that they had "lost" the trade even according to their own chart. And that was all that seemed to matter to him. He was basically saying that they were outright lying in the press statements about their own valuation of the trade, and any other charts are meaningless.

But this situation has created a lot of attention on the whole idea of the "trade chart" and how to evaluate draft trades.

So I wanted to compile a few things here that will help us hopefully put this into perspective, and understand the process and the result with some clarity and objectivity.

History of the Draft Trade Value Chart

In their day 3 presser, Jerry explained that in order to improve his competitive advantage in trades, in 1991 he had asked former business partner Mike McCoy as an engineer to look at the history of trades and come up with a chart that represented the relative value. (McCoy happened to be in the war room with them this weekend as well.)

This DMN article has some background on this, very worth reading.

Today, we have these statistically-based public domain trade charts like those above. But these are current, more sophisticated versions of the same idea behind the original McCoy chart. When that first trade value chart was created, that's exactly what it was. It was based on a historical (1987 to 1990) statistical analysis to come up with a way to judge relative value of draft positions at that time.

At first only the Cowboys had the chart, but then as coaches left for other teams they took the chart with them, and eventually it worked its way around the league and into the public domain, so now everyone has and refers to that original chart.

But as Jerry emphasized, the chart constantly evolves, and the Cowboys update their chart every year, based on statistical analysis from recent years, and attempting to project value into the future (his oil reservoir pressure analogy). It changed with the advent of free agency. It changed with the latest CBA. So the charts the Cowboys and other teams use today are probably closer to these current evidence-based charts out there, than they are to the original chart created by McCoy over 20 years ago.

And as McCoy says, it is not meant to be a hard and fast rule, it is more of a guideline to assist in negotiations.

“It is not the price list for draft picks,” said McCoy, the president of Arkoma Production Company of Texas, an oil and gas firm. “It is what has been done historically. It was to help Jerry move quickly when he needed to and hopefully have an advantage over teams that didn’t have it.”

That statement is backed up former NFL executive Pat Kirwan. In Kirwan’s book, Take Your Eye off the Ball, he wrote, “The bottom line is the chart does not provide teams with an exact formula, but it is a valuable tool for moving talks along from the speculative to the specific.”

And each team likely does have its own chart. The advantage to any one chart is that it is more accurate than the other team's chart. As Stephen said, this isn't a currency where everything has a fixed price. It is a negotiated deal, and having better evaluation of the value of each pick gives you an advantage in negotiations.

And Stephen also emphasized that there are multiple charts, and each team may consult different charts to get an overall sense of the value. It is an "inexact science."

And of course it is affected by each individual draft, and the dynamics of the depth and perceived value in different rounds, which changes from year to year. The top of the draft had lower value this year compared to other years, while the middle of the draft had higher value than usual.

So of course each team's chart is proprietary, and the media doesn't generally have access to this information, so they have no choice but to refer back to the old chart, even though it is completely outdated. Unfortunately, way too many of them just use the numbers of that chart without giving any context that the chart is outdated, and that it isn't used in this strict way by the teams. But anyone who refers to the strict value of the 20-year old chart in order to judge a trade in 2013 is just plain foolish!

Supply and Demand, and The Art of the Deal

As Stephen said in their presser, it really is the "art of the deal." A trade isn't an exercise in arithmetic, it is a negotiation. It is a market with rules of supply and demand. In order for the trade to happen, both teams have to feel like they are getting something better than they are giving up. That may have to do with relative perceived value of players targeted, needs of the teams, the picks each team has, and the depth or supply of good players in the draft class.

In this case, San Francisco had a relatively stacked roster, and an over-abundance of picks to the point that they would have a hard time even signing all the players to their roster if they just stayed put and picked them all, so they had an interest in consolidating picks to trade up and target specific players of interest (one of whom—Reid—happened to be available at 18).

While Dallas had relatively few picks, multiple needs, and looked at the depth of this draft with quality players into the later rounds, so they had an interest in trading back to get more picks.

So there's an inherent difference of interest that creates the opportunity for a mutually beneficial deal. Both had something the other wanted.

Because of the depth in the draft, it created more value for later round picks. But it also created more demand for trading back than for trading up. These two factors find an equilibrium. The supply of quality players relative to their draft position is greater in the later rounds than it is in the early rounds, creating relatively greater value for later rounds picks. But then the demand for these picks goes up as well, so teams may have to pay more in whatever value chart is being used to move back, because the supply of teams willing to move up is more scarce than those looking to move back.

So teams may end up paying more in a chart to move back, but they'll also end up getting later picks that are more relatively valuable in this particular draft. Despite this, the Cowboys still seemed to get an advantage in the deal when analyzed using charts based on actual draft position value over recent years.

Evaluating the Trade

To me, just as the trade value charts are just a guideline for negotiations for teams, they should also just be a guideline for us as fans or media to analyze and judge the wisdom of the trade. I think it's foolish to just look at some spreadsheet for values, especially some 20-year old spreadsheet, to determine if the trade was a wise move.

The current evidence-based trade value charts actually show that Dallas got an advantage in the trade, or that it was a fair deal.

But we can't even look at the current trade value charts in isolation from the draft. We have to look at the specific circumstances.

And we can't just look at a trade in terms of who "won" or "lost" the trade in relation to the other team. Ideally, both teams win by ending up with something better for them.

So the much more important question than "winning" some trade value chart, is really whether you end up with something better for you than what you gave away.

In this case, the Cowboys obviously placed their top priority on finding a quality interior oline player. They actually committed to Romo that they would do so as part of his deal. And it's what every fan and analyst in the land thought they should do. We just weren't sure they felt the same way about it, because it goes against with Jerry has done historically except for Tyron Smith. But it turns out they did feel the same way. And in order to really help fix the line, they needed to spend their top pick and get a player who would be a clear upgrade, not just more developmental players in later rounds who would compete in mediocrity.

Without getting sidetracked into the whole discussion of BPA vs. need, let's just say that it is generally a balance between the two. You are looking to find the best player who is the best fit for your needs.

After the historic run on oline players, including the two guards the Cowboys could have targeted in a trade up both going in the top 10, the best other player on their board who they felt, based on their scouting, would be a serious upgrade to the line and a good fit for their needs, was Frederick.

But they felt that they could get Frederick later than at pick 18, and land an extra pick in the valuable third round in the process, and that the combination of those two picks would help improve the team more overall than whoever they could have picked at 18.

(It is also worth reiterating that by picking Frederick in the first round, even though they had a second round grade on him, they get him for a 5-year rookie contract instead of 4. The threshold between round 1 and 2 isn't just an arbitrary number, it is a significant difference in value due to this extra year in the rookie contract, and how that affects long-term salary cap management.)

We can judge the trade by the process or by the results.

By the process, the Cowboys got a fair deal or even an advantage in terms of the current evidence-based trade value charts, they felt they could get their targeted player at a position of need in the first round for a 5-year contract, and added a pick in the 3rd round that would likely be a 2nd round value player because of the depth of this draft.

By the results, they got the best center in the draft with position versatility, immediately upgrading the area universally identified as the greatest need, while also getting a top receiver at great value in the third round.

Only results on the field over the next few years will truly show the value of the trade, but at this point I'm quite confident to say that I prefer Frederick + T. Williams over Floyd, Reid or whoever else we might have picked at 18.

So to summarize:

  • trades are negotiations, not shopping trips, and trade value charts are a tool to help guide negotiations in a deal, not a price list
  • trade value charts evolve over time with changes to free agency and CBA, and each team has their own charts that are far different from the original McCoy chart
  • trade value must take into account the specific circumstances of the team needs and the draft, the projected players on the board at a later pick, and the relative depth of the class.

When you take all of these factors into account, I think it's hard to argue that the trade itself was not at least a fair deal, and that in process and results, the Cowboys ended up getting more than they gave away in the trade.

Another user-created commentary provided by a BTB reader.

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