At the end of my last post I cautioned that the CHONE projections (and it applies to ALL projections) were a point solution (albeit the best guess at a point solution) and had to be thought of is concert with some error bars.  In an attempt to get my arms around the ramifications of that point I created a quick little monte carlo simulation in excel/vba to produce some distributions for offensive runs above average.  I’ll quickly outline the basic methodology used, to include my input set, and then I’ll present some initial results.

Since I knew I was going to be using CHONE projections I went back and collected the archived projections from 2009.  I did a quick comparison between the projected wOBAs and the actual wOBAs from this year for various levels of prior experience to get insight into what the standard deviation should be for the distributions that will feed the simulation.  The generalized results are in the table below

I ran that information through the simulation in combination with this years CHONE projections and found what I though to be a spread that was too wide (both on an aggregate team basis and an individual level).  I have very little to base this off of other than gut feel and combing back through the Fangraph archives of team totals from seasons past.

To address the variances on the individual level (which in turn addressed the aggregate solution) I went from using a normal distribution to a truncated normal by placing upper and lower bounds on the simulated wOBA (I implemented this using a re-draw method vice a rounding method).  The upper and lower bounds were influenced by reviewing the 2009 data and looking for caps that existed for various projected production levels (i.e. a projected 0.300 wOBA never produced beyond a certain actual wOBA). That still did not give results on the aggregate that passed the “smell test”, so I cut the standard deviations in half.  This last move was rather arbitrary on my part, and I plan to do some robustness testing along with analyzing a larger data set than just 2009.  That being said, the simulation was “done” and is at a state where I didn’t mind putting results out for all to see.

For today I have three scenarios to display reults from

1. Signing Matt Holliday and going with internal options at the rest of the positions
2. Going entirely with internal options (basically Freese at 3rd and Craig in left)
3. Same as 2 except downward adjusting the Freese and Craig Projections as they “feel” a bit high

After the jump I’ll have more input data and the results.

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