Three years ago, I wrote about Washington wanting to trade up by giving up future picks, decrying the idiocy of trading future picks in a NFL draft world where the interest rate is “one round for one year”. At the time, I wrote of Belichick:
Bill Belichick is the butterfly collar wearing pawn shop dealer standing behind the glass case of watches. Daniel Snyder is the guy that just needs that next influx of cash so he can buy some more lottery tickets and to score a hit. The last few years, the Patriots have been capitalizing on teams’ inability to have patience and to understand the market (Armanti Edwards, anyone?), and have repeatedly traded picks that net them high interest returns by delaying gratification.
I referenced Belichick’s propensity to trade for the future but hadn’t specifically looked into the details. How costly/beneficial is it to trade up and down, by paying the interest rate of (at least) one round to get an immediate extra pick now?
To analyze, I limited it to trades where (a) one team delayed gratification by getting a draft pick a year later, and (b) the pick they got was at least one round higher than the pick or picks they surrendered. This removed some of the classic trading cases, such as a team moving back into the first round to take a quarterback, by giving up a future first round pick. I am confident including those cases, like Brady Quinn or Jason Campbell or J.P. Losman, would not change the conclusions much. It also removes cases, which happen frequently, where a future pick is a throw-in to a deal (such as a future 7th rounder).
So, for example, trading a future 2nd for this year’s 3rd round pick would be included in this analysis. Trading a future 7th and a 4th and 5th to get this year’s 3rd round pick would not.
26 total trades made during the 2000 to 2009 drafts were reviewed. The result? The team “delaying gratification” is getting close to a 50% return on the investment–rates that would qualify as usurious.
Using the Approximate Value numbers at Pro Football Reference, the team trading for a pick now, and giving up a better pick in the future, got 16.5 points, versus giving up 25.2 points in value. That’s a 152% rate of return by delaying a year, from the perspective of the patient team. Those actual results are similar to the hypothetical rate we get by using the draft pick value calculator, which calculated the team acquiring the future pick would get a 157% rate of return.
Here are the ten most lopsided future pick trade-ups from 2000 to 2009, with the team listed first being the team that traded for the “now” pick, and the other team in the trade listed second (though the players drafted were not always taken in the future by the same team that made the trade).
In contrast, the most lopsided trade the other direction was the Colts trading a future 4th to take Robert Mathis in the 5th round in 2003. (Glenn Earl was selected with the future pick). The only other one that could be considered a solid “win” for the impatient team trading a future pick was Chris Cooley for Josh Bullocks in 2004.
The two teams most frequently willing to trade you a pick this year for a better one in the future were New England (8) and Philadelphia (5) during this time frame, so Belichick’s reputation is valid. It should be noted that since 2000, those two franchises are among the best run organizations, and have made the playoffs 75% of the time. Being willing to delay gratification for great returns is not necessarily the reason they have done well (we are still only talking 13 cases here over a decade), but is merely one of the ways in which they demonstrate an understanding of value.