StarStreet

I first heard about StarStreet at the MIT Sports Analytics Conference in March. Some of you may remember Protrade; StarStreet is trying to do the same thing except it uses real money. When StarStreet first started trading, there was no backing to the players. It made no sense. The only way to make money was to buy a player and hope the site grew and people would want to buy popular players. It seemed like a short lived idea and within a month or two, the market had stalled because the site had stopped growing. I know of at least one person who made money though.

On August 1st, StarStreet announced a new valuation system based on player performance (here). There is still one aspect I'm a little unclear about and that's the idea of proportional value. In the actual stock market everything can go down or up independently of each other. If Apple blows out its earnings report, if will go up even if Cisco does too. For StarStreet, if Jose Bautista hits three home runs, he will only go up if the other offered players do not increase their value to the same extent.

Since the new valuation system was started with around 100 games of data, the final payouts based on relative fantasy points were already priced into the StarStreet determined IPO. The only way a player could see a substantial change in value would be an injury and since StarStreet doesn't allow short sales (yet?), there's no way to make money off that.

Nevertheless, here is a chart of the StarStreet offered players with their final projected price vs. last traded price. I used the ZiPS RoS projections available at Fangraphs.



It's not surprising to see the players (Ubaldo and Liriano) with good track records but underperforming this season be projected to return the most value. As I write this, Ubaldo is getting shelled in Detroit so I wouldn't go buying his shares just yet. As I wrote above, I wouldn't expected any drastic returns from the MLB market.