Thursday, January 25, 2018

Expected Future Value of The Hockey News NHL Future Watch Prospects

Every year the Hockey News magazine puts out a publication called "NHL Future Watch" which ranks the best prospects not currently playing in the NHL. They are all either under contract or a team owns their rights. They rank the top 75 prospects in the whole league, then do a top 10 list for each individual team. Last year they started doing a top 100 list, but since most of the historical data is top 75, we'll stick to that for the purpose of this investigation. If you would like to know the probability of any given draft pick getting ranked in the FW, click here.

What can we expect the Future Watch prospects to earn in future NHL salary?

Expected Salary For Top 75 Ranking

The graph below shows the expected NHL salary at age 23 for each FW rank position (using magazines from 2006-2012). That is the age when most entry level contracts have expired. Each dot does not represent an individual player, but the average for each rank position. It will also only include drafted players, mostly because I don't yet have undrafted players in my prospects spreadsheet. Goalies are also not included.

The logarithmic trendline fits to a 0.65 R^2, which is a respectable correlation between Future Watch rank and future salary. That line crosses the million-dollar threshold near the 65th spot in the rankings. If you look at a chart with the expected future value of the first 50 picks in the draft, it would look very similar to the chart above, but with a steeper decline. If I were to do a rival Future Watch publication and just listed the highest draft picks not currently playing in the NHL, I could probably replicate these results. I believe it would be less accurate, but the scatter plot would have a similar shape.

It's worth noting that the #1 overall rank in Future Watch does have a lower expected future salary than some of the ranks following it, which is thanks to Nikita Filatov playing back in Russia at age 23 and registering a zero in the NHL salary column. None of the other top 10 rank positions had a zero.

Expected Salary By Team Rank

These are only for players who ranked in a team's top 10 prospects but did not make the top 75 list. In most cases, players ranked in the top 2 spots on individual team rankings will also be on the top 75, so we start at the Expected Value of the #3 spot.

The linear trendline fit with a 0.78 R^2, which is another strong correlation. If there were no "future value" pattern to the Hockey News prospect rankings, we would see a flat line with a slope and R^2 close to zero. Choosing a single linear trendline is a bit deceptive; it would fit the data better to have two different lines connecting at rank=6, with a steeper slope for the first half and a flatter slope for the back half (unfortunately MS Excel doesn't offer that option). There is no difference between the 7th position and the 10th position. If a prospect is ranked in the top 5 for an individual team, he can expect a higher future NHL salary than someone ranked in the bottom 5; where there is very little difference between the ranks.

The Hockey News does a great job with this publication. Even if I could mathematically predict what the ranks are likely to be every year, they write detailed insightful write-ups for every prospect after doing interviews with dozens of scouts. That's the part that's hard to replicate.

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