Wealthsimple is a whole new kind of investing service. This is the latest installment of our “Data” series, where we dig into the numbers to learn more about how the world of money works.
By now you probably know the shot. You’ve seen the shot on every media platform available to humans with eyeballs everywhere in the world. At the end of the Eastern Conference Semifinals, with half a second on the clock, guarded by seven-footer Joel Embiid, Kawhi Leonard pulled up from the far corner of the court. Leonard was the man the Toronto Raptors basically sold the farm for in a trade — a player on the last year of his contract, coming off a mysterious injury, about whom there were whispers of a locker room problem. And, as you know, the ball took its time in determining whether it was a good shot to take or a bad one, a great season or an OK one, a genius trade or a bust that could relegate the Raptors to a years-long rut of self-examination and early departures from the playoffs.
Four suspenseful bounces later, Kawhi Leonard launched the Raptors into the Eastern Conference Finals. And then to the NBA Finals.
But the thing is, this wasn’t actually a fluke shot. Even taking into account that any single shot is a fluke shot. Because: data. The numbers show it was something, statistically speaking, we could have expected from Kawhi Leonard.
That’s part of the reason the Raptors’ trade for Leonard is the best trade ever.
Yep, since we know a thing or two about trading (and we’re unabashedly fans of our hometown team) we feel comfortable asserting that the Kawhi Leonard trade was the greatest trade ever. We say that with complete certainty — and a tiny side dish of that special blindness required to make the argument that someone or something was the very best anything of all time.
Here’s why we’re right.
Assertion One: What They Got Was Better Than What They Gave Up
Let’s not get crazy (at least right away). Let’s start with the first thing any trade has to do: what you get has to be better than what you give. The Toronto Raptors’ president Masai Ujiri decided to give the following players to the San Antonio Spurs:
DeMar DeRozan, most important guy on the team, most popular player, face of the Raptors. Jakob Poeltl, a young and promising seven-foot center. And a protected first round pick for 2019.
In exchange, the Spurs sent:
Kawhi Leonard: a brooding, supremely talented forward with a mysterious injury, who was in the last year of his contract. And Danny Green: a veteran, efficient shooter.
Who won? Well. The Raptors. The score was: .57 to 2.4
Maybe you’re saying .57 what? 2.4 huh? In order to defend those numbers, we need to explain one of the most popular sports statistics among sports statistics nerds in the last decade.
Assertion Two: The Best Way to Measure the Value of a Player Is WPA
WPA means win probability added. It’s an idea borrowed from baseball and implemented by actuary Mike Beuoy that tries to measure not only what a player did, but how much of an impact his actions had on the eventual outcome of the game. WPA compares a team’s chances of victory before and after each event a player participates in, whether it be a turnover, made or missed shot, or rebound.
Each positive event boosts a team’s chances, while negatives like turnovers make a win less likely. Total up all of the probability a player’s actions contributed to victory or defeat, and you have a good measure of how much of the win they are personally responsible for. Until WPA, most basketball statistics were blind to context: a basket scored in the first quarter counts the same as Leonard’s game-winning basket, for example. By contrast, WPA considers when a player scores, rebounds, makes a turnover. Because a basket made when the game is on the line boosts a team’s chances of winning more than one scored midway through a blowout.
WPA thus rewards the players, like Leonard, who save their biggest and best performances for the most critical moments. The best players in basketball accrue 5-10 wins worth of WPA per 82-game season, boosting their chances of winning a given game by about 10%. By this metric, Leonard was solely responsible for seven wins in the regular season, and more importantly, more than two whole wins of the Raptors' magical playoff run.
Leonard’s postseason success in 2019 is already the most impact a traded player has had since 2013
So the number above means the best player in the trade — Leonard — was worth about 2.4 playoff wins, while the second-best player (DeRozan) was worth .57 playoff wins. It's very difficult to calculate the future value of all the players who were traded (especially draft picks). So we concentrated on value when it's most real: right now.
Assertion Three: The Thing That Matters Most Is Winning It All
Let’s not lose the forest for the trees here. The stated goal of every sports franchise is to win a championship. No one takes over as head coach of a basketball team — or football team or a hockey team or a cornhole team for that matter — without saying, “Our goal is the Super Bowl/Finals/Stanley Cup/Cornhole Bowl.”
So if your metric is how much closer a player gets you to a championship you could make the argument (in fact, we are!) that Kawhi Leonard was the most impactful trade in the modern NBA. How do we prove that? Let's discuss.
Assertion Four: Best. Trade. Ever. (At Least Since 2013)
It’s no surprise given the last couple of series, but if you look at WPA in the playoffs, the Raptors’ decision to acquire Leonard will go down as the best trade in the last six years — which is as far back as WPA data goes. Leonard’s postseason success in 2019 is already the most impact a traded player has had since 2013. He beats out second-place Rodney Hood (1.51 WPA) by more than half a win on his way to 2.4 WPA. His performance is the best in the league this postseason and the ninth-best playoff performance by any player since 2000.
Kawhi’s game-winning hoop, for example, was worth 0.389 WPA alone. If he hadn't made it, the Raptors' chance of winning the game (and the series) would have been almost 40% lower.
Assertion Five: It's an Unusual Victory to Ever Trade for a Superstar
It’s a win to even get a player like Kawhi via a trade. Mid-career superstars tend not to get traded; when they switch teams it’s by signing free agent mega contracts instead, like LeBron’s pact with the Lakers. Leonard’s journey to Toronto is an exception and a remarkable accomplishment for the Raptors' front office.
Assertion Six: Kawhi Was Good Already. But He’s Exceeded Expectations
It’s not as if Leonard’s greatness came from nowhere. Except for some time lost to injuries, he’s been excelling in WPA nearly his whole career. He ranks fifth among all players in basketball since 2000 behind only LeBron, Chris Paul, Dirk Nowitzki, and Kevin Durant. And he’s ahead of some historic greats like Steph Curry and Kobe Bryant. Leonard’s postseason performances have been remarkably consistent. His last five years of playoff WPA scores have ranked first, second, eighth, twenty-third, and fifth. Few other ballers can boost playoff clutch performances so impressive and so steady.
Before this season, most NBA observers tended to list Leonard as the 7th-8th best player in the NBA, but his name was rarely mentioned alongside the distinguished MVPs of the past two decades like Durant and James. Based on his playoff accomplishments, he’s right up there with the best of the last decade. This year, Leonard is outperforming even the lofty benchmarks he set for himself in previous postseasons. This is the highest total WPA Leonard has accrued to date, beating even a spectacular run with the San Antonio Spurs in 2017. Asked to carry more of the load on the Raptors, Leonard has stepped-up and delivered more wins than even the most optimistic projections predicted.
Trading for Leonard turned out to be like buying stock in Apple 15 years ago: an extraordinary return on investment. Except you didn’t have to wait 15 years for it to happen. The table below shows exactly how he's defying expectations.
Assertion Seven: He’s Already Providing a Return on Investment in Real Dollars
Helping your team advance in the postseason has real economic benefits. As in: millions of dollars in added revenue for Toronto. A back-of-the-envelope estimate from Darren Rovell put the team take from appearing in a single finals game at around 10 million dollars. The fact that Kawhi has propelled the Raptors to even just this year’s championship appearance means the team will make a whopping extra $20-40 million. And since, extrapolating from Rovell’s numbers, Conference Finals home games are worth $3 million each in ticket sales, you can add $12 million in extra revenue for the Raptors. That makes the grand total for extra revenue somewhere between $32 and $52 million.
Assertion Eight: Sure, His Contract Was Only for a Year. But the Raptors Knew they’d Be in the Best Position to Re-Sign Him
The Raptors' vision in trading for Leonard is not only about his superlative performance this postseason. Thanks to acquiring Leonard’s rights before he hits free agency (and because of the NBA’s convoluted salary rules), the Raptors can offer Leonard almost $50 million more in a free agent contract than any other team. That’s not chump change for a player who has only made a total of about $80 million in salary his entire career.
And greater Toronto is stepping up to add to the comp package: fans are offering him everything from free food to a multimillion-dollar condo.
After becoming the playoff hero in one of the NBA’s largest markets, Leonard might just question the value of being one of 5,124,347 stars who live in Los Angeles (which he previously sought). Toronto offers him the adoration of an entire country's worth of basketball fans — L.A. has two teams in the same city.
Assertion Nine: Leonard Could Start a Trend
If he stays? Given the NBA's current environment and the tendency of superstars to flock together (see: the all-star team known as the Golden State Warriors; or what happened to the Heat when LeBron showed up), Leonard could make the Raptors more attractive to future free agents. So… Anthony Davis? Al Horford? Any of you guys want to hang out with Drake?
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