Hot Stove Contracts: Incorporating Time Value of Money into MLB Free Agent Analysis

: Brett Albert
: $6
: Jan 26, 2019
: Aug 6, 2019
: MCC02019
: Digital PDF
: 7 pages
: 5 pages

Every year, the proverbial “Hot Stove League” in baseball’s off-season prompts myriad headlines about outsized player contracts. But do these nominal values tell the whole story? In this case, students will be tasked with representing a fictional baseball player, Rolando Mateo, as he works his way through his first free agent negotiation. By drawing on fundamental concepts of the time value of money and balancing qualitative considerations with quantitative analyses, students will work to rank Mateo’s offers—and provide their client with a final recommendation for his path forward. 

Finance Contracts Time Value of Money

Sport Finance