On Montreal trading Halak

I said most of what I wanted to say when I wrote about Halak and Price a month and a half ago.  The difference in value between the two goalies is very small, while perception of their abilities will never be further apart.  With Halak's contract up, it was time to sell - I imagine he'll want quite the long-term deal, and it'll be hard for St. Louis (or anyone else) to wring a lot of surplus value out of him.  Over the next three years, Halak will probably be underpaid by at most $10M, but beyond that he'll be worth at most what he gets paid.  At worst, if he's injured or ineffective, he's a multi-year sinkhole. 

Montreal's return on the deal might not seem that impressive, but a #13 pick like Lars Eller is worth about $3M (of future value) the day he's drafted.  By the time it's apparent he can play in the NHL, he's worth $5M, with some upside.  Overall, this is an asymmetric deal:

 

 $M Upside Downside
St. Louis 10 -43
Montreal 10 -10

 

That's a bit simplistic, but it's essentially what's going on here.  In the worst case for St. Louis, they sign Halak to a big contract and he's ineffective and needs to be stashed in the minors, and Eller turns into an OK player.  In the worst-case for Montreal, they lose out on Halak's $10M in surplus value over the next three years and Eller never plays in the NHL.  If you're not convinced Halak's as good as the contract his agent is demanding, you make this deal.  Montreal has simply limited its downside exposure to his failure.

On another note: Denmark will soon be an international hockey power!

X
Log In Sign Up

forgot?
Log In Sign Up

Please choose a new SB Nation username and password

As part of the new SB Nation launch, prior users will need to choose a permanent username, along with a new password.

Your username will be used to login to SB Nation going forward.

I already have a Vox Media account!

Verify Vox Media account

Please login to your Vox Media account. This account will be linked to your previously existing Eater account.

Please choose a new SB Nation username and password

As part of the new SB Nation launch, prior MT authors will need to choose a new username and password.

Your username will be used to login to SB Nation going forward.

Forgot password?

We'll email you a reset link.

If you signed up using a 3rd party account like Facebook or Twitter, please login with it instead.

Forgot password?

Try another email?

Almost done,

By becoming a registered user, you are also agreeing to our Terms and confirming that you have read our Privacy Policy.

Join Arctic Ice Hockey

You must be a member of Arctic Ice Hockey to participate.

We have our own Community Guidelines at Arctic Ice Hockey. You should read them.

Join Arctic Ice Hockey

You must be a member of Arctic Ice Hockey to participate.

We have our own Community Guidelines at Arctic Ice Hockey. You should read them.

Spinner.vc97ec6e

Authenticating

Great!

Choose an available username to complete sign up.

In order to provide our users with a better overall experience, we ask for more information from Facebook when using it to login so that we can learn more about our audience and provide you with the best possible experience. We do not store specific user data and the sharing of it is not required to login with Facebook.

tracking_pixel_9355_tracker