OneSeason.com has created a market where fans can buy and sell shares (with real money) of players in the NFL, NBA, MLB and NHL. Supply and demand drive the price of each share, and value would theoretically rise as the player gets better. This would allow savvy fans to identify players that are about to break out and make a profit in the process.
I actually had a similar idea several years ago, but I was never able to get my head around how the cycle for each player would end. A player’s stock would continue to be traded into his retirement, but other than a potential Hall of Fame induction, there is no more “potential” to speak of. When investors buy shares of a company in the stock market, they effectively own a piece of the company. And since all companies are (presumably) going to continue to be profitable into the future, there is only a small risk that the company goes out of business leaving the shareholder with nothing. At OneSeason, a player’s stock will be expected to fall as he tops out in his career. He no longer has “potential” and, assuming the number of total investors stays the same, his stock price will fall.
So it seems to me that this market will be driven by young players that are rising stars. Once a player hits 27 or 28 years of age, he probably won’t improve his game/performance, so his share price would take a dump. Investors would start to notice this, so they would want to sell their shares earlier to avoid this decrease, so players would start to see a share price dip at 26 or even 25 years old.
It’s an interesting idea, but without a continual increase in the number of investors, I don’t know how a player’s share will sustain its value through the end of his career and into his retirement. This virtual certainty of a loss in value would seem to play havoc with share valuations throughout his career, making the entire market a bad idea on the whole. I think people could make money in spots, but they would be capitalizing on the losses of fellow fans.
