Investing in top NBA rookies – has it been profitable?

Every year, the NBA gets a fresh injection of new and exciting talents from the latest class of rookies. Top draft picks, such as Ja Morant and Zion Williamson, have been a joy to watch this year.

And from the draft classes of recent years, many players have already become All Star level contributors. The league just would not be the same without the likes of Joel Embiid, Jayson Tatum, or Luka Doncic.

But has it been profitable to invest in these rookies early on in their careers?

For this piece of research here at the ScoreMetrics Lab, we wanted to test out whether or not the following hypothesis was true:

“The best rookies have a transformative effect on teams, and this is undervalued by bookmakers. This should cause the teams of the top 3 picks of a draft to be profitable investments against the spread.”

Could such a simple hypothesis prove to be valuable? Read on to find out what we discovered.

Top picks from the last five NBA drafts

Since the current season is not finished yet, we decided to start from the 2018 draft and go through the last five seasons in our sample for this research, starting from the 2018-2019 NBA season.

Let’s begin by looking at the players that qualified – the top three draft picks from those five drafts:

PLAYER

TEAM

YEAR

PICK

Deandre Ayton

Phoenix Suns

2018

1

Marvin Bagley III

Sacramento Kings

2018

2

Luka Doncic

Dallas Mavericks (via Atlanta Hawks)

2018

3

PLAYER

TEAM

YEAR

PICK

Markelle Fultz

Philadelphia 76ers

2017

1

Lonzo Ball

Los Angeles Lakers

2017

2

Jayson Tatum

Boston Celtics

2017

3

PLAYER

TEAM

YEAR

PICK

Ben Simmons

Philadelphia 76ers

2016

1

Brandon Ingram

Los Angeles Lakers

2016

2

Jaylen Brown

Boston Celtics

2016

3

PLAYER

TEAM

YEAR

PICK

Karl-Anthony Towns

Minnesota Timberwolves

2015

1

D’Angelo Russell

Los Angeles Lakers

2015

2

Jahlil Okafor

Philadelphia 76ers

2015

3

PLAYER

TEAM

YEAR

PICK

Andrew Wiggins

Cleveland Cavaliers

2014

1

Jabari Parker

Milwaukee Bucks

2014

2

Joel Embiid

Philadelphia 76ers

2014

3

How did the top draft picks’ teams fare as ATS investments?

Below, we have compiled the overall ATS records of each of top three rookies’ teams from the last five seasons:

2018-2019

Team

Player

ATS Record

Cover %

Dallas

Luka Doncic

46-35-1

56.8%

Sacramento

Marvin Bagley III

45-35-2

56.2%

Phoenix

Deandre Ayton

36-46-0

43.9%

2017-2018

Team

Player

ATS Record

Cover %

Boston

Jayson Tatum

62-37-2

62.6%

Philadelphia

Markelle Fultz

52-38-2

57.8%

LA Lakers

Lonzo Ball

43-39-0

52.4%

2016-2017

Team

Player

ATS Record

Cover %

Philadelphia

Ben Simmons

49-33-0

59.8%

Boston

Jaylen Brown

51-47-2

52.0%

LA Lakers

Brandon Ingram

37-43-2

46.2%

2015-2016

Team

Player

ATS Record

Cover %

Minnesota

Karl-Anthony Towns

39-42-1

48.1%

Philadelphia

Jahlil Okafor

37-44-1

45.7%

LA Lakers

D’Angelo Russell

36-46-0

43.9%

2014-2015

Team

Player

ATS Record

Cover %

Milwaukee

Jabari Parker

48-39-1

55.2%

Philadelphia

Joel Embiid

40-40-2

50.0%

Cleveland

Andrew Wiggins

49-52-1

48.5%

For the first two seasons in the table, our research shows promise – Dallas, Sacramento, Boston and Philadelphia covered the spread at a nice rate.

But things start to look worse when we go further back in seasons, and we end up with an average cover rate of 51.9% when we take all of the qualified rookies and their teams into account.

For reference, the breakeven point for ATS investments with the rather standard -110 odds is at around 52.5%. We are not looking at a winning investment strategy here.

Conclusion

So, why didn’t this hypothesis end up producing gains? For NBA fans, it’s easy to spot some obvious flaws in our original hypothesis.

Joel Embiid, Ben Simmons and Markelle Fultz missed all (Embiid, Simmons) or most (Fultz) of their rookie seasons with Philadelphia. Jahlil Okafor (also for Philadelphia – yikes!), Andrew Wiggins and Jabari Parker also definitely did not end up performing up to the high expectations that were placed on them by teams and bookmakers alike.

Some of the rookies on the list also ended up having rather limited responsibilities. Did Marvin Bagley’s contributions really cause Sacramento’s good ATS season, or was this more due to De’Aaron Fox and Buddy Hield catching fire?

Draft picks can be hit or miss, and this causes a lot of variance in ATS performance as well. The difference that rookies are able to make is hard for bookmakers to predict as well.

One thing that we keep coming back to is the fact that such simple hypotheses rarely end up making successful sports trading systems.

But if we start looking deeper into the data, we might find something interesting. What if we include minutes per game and usage rates of the rookies in the sample and start filtering the data? How about looking at the records of each team from the previous year and see if there is a correlation there? Or what about extending the research to include the top 10 draft picks from each year?

Maybe we shall get back to this at a later point.

In the meanwhile, to prepare for the return of sports and to learn everything you need to know about smart investing in the sports betting market, check out our head trader John Todora’s new book – “Zero Correlation Investing – The Score Metrics Secret”. It’s currently on sale for a limited time, so go get yours now!

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