Andrew McCutchen and Selling Low

Buy low and sell high. It’s the investing concept we’re all taught at a young age, and it makes everything sound so simple. If you buy assets when their value is about to go up, and sell them when it’s about to go down, then you’ll get rich. Super easy! Everyone should do it! Get excited!

Life, however, is more complicated than that. The high and low points of a trend graph are easy to spot when looking retrospectively, but when you’re in the midst of the graph, determining whether things are about to go up or down is more difficult. Forecasting isn’t as easy as buy low/sell high makes it sound.

So, with that said, let’s talk about Andrew McCutchen.

The Pirates franchise player had a disastrous 2016 season, putting up career worst numbers in basically everything that counts. His walks went down, his strikeouts went up, and he posted his lowest ISO since his pre-breakout 2010 season. He hit 24 infield flies, more than doubling how many he had the year before, which drove his BABIP down 40 points below his career norms. After recording double-digit steals in every prior season, McCutchen was successful on just six of his 13 stolen base attempts. Never a great center fielder, UZR and DRS both think McCutchen was a disaster in center field, with a -19 UZR and a -28 DRS.

After four years of consistently being one of baseball’s best overall players, McCutchen was not far from being a replacement level performer last year. His downturn is one of the main reasons the Pirates failed to contend for a playoff berth. And that lousy year, following a run of great seasons, raises interesting questions about the timing of a potential McCutchen trade.

On the one hand, there’s the simple buy low/sell high philosophy, which suggests that the Pirates should hold onto McCutchen; dealing him now would be the definition of selling low. Let him show that 2016 was a fluke, re-establish himself as a high-level player, and then move him this summer or next winter if the team feels that a trade is necessary for the franchise.

On the other hand, there’s reality. No one knows if McCutchen’s value is actually going to go back up. A bounce-back is no guarantee, and as a 30-year-old with a history of knee problems who seems to be losing his athleticism fairly rapidly, it is entirely possible that the McCutchen of the past is gone forever. It may even be likely that McCutchen’s future is as a bat-first corner outfielder, not the all-around superstar that he was previously, given how aggressively his secondary skills regressed last year.

So when it’s suggested that trading McCutchen this winter would be selling low, we should ask what the baseline for that belief is. Low in regards to what his value was a year ago? That’s meaningless, because he’s never going to be 29 again, have three years left on his contract and be coming off a 6-plus-win season. McCutchen’s trade value now is significantly lower than it was 12 months ago, but it’s only selling low if it’s lower than it will be in the future. And that’s not as clear.

We should expect McCutchen to improve next year. Steamer projects him for a 129 wRC+ and a +3.5 WAR season, which isn’t quite back to superstar levels, but is dramatically better than he was in 2016. But just because his performance should improve in 2016 doesn’t mean his trade value necessarily will.

Any team trading for McCutchen this winter is doing so with the expectation of a rebound. They’re already pricing that belief into their willingness to trade for him, and will base their offers on the expectation that they’ll get two good years from him before they have to decide to extend him or let him walk as a free agent. To raise his trade value, McCutchen’s 2017 performance would have to exceed not his 2016 performance, but the expected performance of the current buyers, and by enough to outweigh the loss of at-bats a team would get by trading for him in the future.

Because even if McCutchen reduces the risk around his performance with a strong 2017 season, he’s going to be churning through a good chunk of the remaining time he has left under contract while doing so. At this point, an acquiring team can expect something like 1,200 plate appearances from McCutchen; by mid-season, that will be down to about 900, a 25% reduction in potential value. Some of that lost value can be offset by the potential for reduced supply of available talent at the trade deadline — which is one of the main reasons why prices are higher in July — but this isn’t a normal off-season, and there aren’t exactly a number of great options available to buyers this winter, so the scarcity gap between off-season and in-season pricing are likely smaller this year than most years.

So for McCutchen’s trade value to go up, his performance would have to exceed expectations to a larger degree than his loss of playing time would diminish what acquiring teams would pay. That’s certainly possible — especially if McCutchen’s defensive metrics are being driven by playing too shallow, which should be fixable — but it isn’t any kind of certainty. If the Pirates move McCutchen back and he’s still failing to catch enough balls to continue as a center fielder, then his value could sink in a hurry, since it’s a lot easier to find a corner outfielder than an up-the-middle guy with McCutchen’s offensive abilities.

So I just don’t really buy the idea that the Pirates would be making a mistake to trade McCutchen now. The market in baseball is more rational than it ever has been before, and if the Pirates made him available, contenders looking for an upgrade aren’t going to just let some other contender get a bargain by paying 50 cents on the dollar. Based on his expected 2017 performance — which is what teams are rightly paying for now — McCutchen would still be a coveted player, even coming off a lousy season, and teams looking to improve this winter would bid up the price until it reaches something close to a rational point.

Now, that isn’t to say the Pirates have to trade McCutchen this winter. They still have enough talent to be a Wild Card contender, and they might decide they’re best served by keeping him and making another run, then re-evaluating their position in the summer. But if they do decide to listen to offers this winter, we shouldn’t assume that they’re definitely making the wrong decision, or that they’d do better if they held him until next summer. Just because McCutchen’s value is low relative to what it was a year ago doesn’t mean it’s low relative to what it is going to be in the future.