Schoop locks in early pay-day for future earnings

[Aristotelian]

Pretty shadowy IMO. Lots of potential for corruption. Hedge funding, betting against performance projections. I don't think MLB and possibly the union will like it. I can imagine a scenario in the new contract where arbitration will be offered earlier in a player's career.

Yes, how is this not betting on baseball?

[Can_of_corn]

Yes, how is this not betting on baseball?

Because you are "betting" on a player's future compensation.

[VTech]

This is a fascinating development, and one that the MLB owners may not like much. I wouldn't be surprised to see this issue become a point of discussion in the CBA talks.

In essence, it's a form of insurance. And it certainly reinforces the idea that the players are commodities.

I wonder what a "Manny future" would sell for?

Not sure where I found it but I think I remember it said that the MLBPA and CBA are the ones that approve the lump-sum payment

Also, it looks like fantex sets the share price. Can't imagine these to have high liquidity either

[Frobby]

Not sure where I found it but I think I remember it said that the MLBPA and CBA are the ones that approve the lump-sum payment

You're right. From the MLBTradeRumors article that is linked to the twitter entry you posted:

(Notably, the league and the MLBPA each approved [Heaney's] agreement, and Fantex’s announcement seemingly suggests that the same is true of these five agreements.)

[Frobby]

For anyone who's interested, the Fantex website can be found here: https://fantex.com/

[MrOrange82]

Because you are "betting" on a player's future compensation.

Which is only a few degrees removed from the player's on-field performance. I don't know. I agree with those who say it seems shady. Sure, broader market forces will help dictate future prices/earnings, but this seems bad.

[Br10n]

How are Ian Desmond investors looking right now? I know he is not participating. I am just making a point....this has sooo many potential issues.

[Going Underground]

For anyone who's interested, the Fantex website can be found here: https://fantex.com/

They are trying to get an IPO of a group of players to invest in. I guess sort of like a mutual fund of players. Looks like they have tried to get the IPO out a few times but have not got it done yet. UBS is backing them .

[MurphDogg]

The reason that this exists is because there is too great of a difference in salary between free agent players and pre-arb players.

The MLB minimum should be higher which would in turn lower the salaries for mediocre free agents. It is crazy how much more money mediocre free agents make than pre-arb and arbitration eligible stars.

[Can_of_corn]

The reason that this exists is because there is too great of a difference in salary between free agent players and pre-arb players.

The MLB minimum should be higher which would in turn lower the salaries for mediocre free agents. It is crazy how much more money mediocre free agents make than pre-arb and arbitration eligible stars.

I'm not sold that would actually happen.

[MurphDogg]

I'm not sold that would actually happen.

You think players would just get a larger piece of the net revenue pie? I doubt it.

[DrungoHazewood]

I'm not sold that would actually happen.

The minimum would have to be quite high. Currently it's about 14 league minimum players to equal one year of a 1-win free agent. Let's guess there are 300 minimum-salaried players in MLB, and total salaries are $3B. That makes minimum-salaried players 5% of total salaries. For a typical team that would make $5M for the lower class, and $95M for arb/free agents. Quadrupling the minimum would still make the split 80/20.

[Can_of_corn]

You think players would just get a larger piece of the net revenue pie? I doubt it.

First off the players would have to give up something in order to secure an increase that could possibly make a difference.

And yes, I think if the minimum salary were to move up to one or even two million it would have a negligible effect on the contracts that I think you are talking about.

It would lead to more players non-tendered.

[Can_of_corn]

The minimum would have to be quite high. Currently it's about 14 league minimum players to equal one year of a 1-win free agent. Let's guess there are 300 minimum-salaried players in MLB, and total salaries are $3B. That makes minimum-salaried players 5% of total salaries. For a typical team that would make $5M for the lower class, and $95M for arb/free agents. Quadrupling the minimum would still make the split 80/20.

First off the players would have to give up something in order to secure an increase that could possibly make a difference.

And yes, I think if the minimum salary were to move up to one or even two million it would have a negligible effect on the contracts that I think you are talking about.

It would lead to more players non-tendered.

You did a much better job than I did there.

[beantownrefugee]

Interesting idea. I did not see on the Fantex website what constitute's "player earnings". Is this pre-tax, pre-union dues, pre-agent fees, etc.? Seems like if the earnings occur after agent fees have been deducted, Fantex would have an interest in performing agent services. The Vernon Davis OTC listing paid a dividend for his Levi's sponsorship, so it appears any advertising dollars are included in his earnings.