The IPL auction was conducted with much fanfare as usual with the added element of suspense in the backdrop of the board’s problems. The results of the auction would suggest that it’s just another day in the office for the IPL with team owners, willing to pay top dollar for the marquee players.
The Indian Premier League (IPL) went about the auction for the 2017 chapter with about the same enthusiasm; the results however came as a shocker in certain cases. There was a record set for the most expensive international player and quite a few players were purchased at prices that far exceeded their own estimates.
Ben Stokes – the player under question for setting a record – was picked by RPS (Rising Pune Supergiants) for Rs 14.5 crores. He reacted with amazement at the price tag and appeared full of gratitude. This underscores that it was an expensive proposition going by the player himself. Not surprising considering that five of the eight teams showed a heightened interest in him.
Is such an expensive proposition worth it?
Of course there will be varying views on the subject. It’s different strokes for different folks with most buying decisions – one team may find tremendous value in a player and willingly bag him at an astronomical price tag, while another team may want to go with a lower priced player for financial and team selection considerations.
Also, no one has a crystal ball to estimate whether an expensive player like Ben Stokes can justify the price tag. So there is little point in going there.
However, we do have the benefit of past experience to determine whether an expensive price tag has delivered results historically.
T20 – a game of even more glorious uncertainties
Let’s take expensive players like Kevin Pietersen and Andrew Flintoff – price record setters themselves in the 2009 IPL edition or Yuvraj Singh – who holds the all-time record for any IPL player.
While there will be views on their star appeal, skill, potential, the short answer is they did not justify their price tags on most occasions.
Most players who did justify their auction prices in the eyes of their team owners, were the mid to lower priced players, but more on that later.
There are many reasons why getting bang for the buck may not be possible most of the time for IPL team owners. T20 cricket is full of surprises, which allows even lower ranked teams to win and regular players to excel. Put differently, great teams and players do fail frequently. As uncertainties go, a T20 match is the most uncertain 40 overs one can expect to see on a given day and the results will likely be vastly different the next day with the same teams and players.
That explains why Australia, five time ODI World Champions, haven’t won a single edition of the T20 World Cup; in fact they made it to the final just once. While India, Pakistan, England, West Indies (twice), Sri Lanka are all T20 World Cup winners.
In the latest, 2016 T20 World Cup edition, readers will recall how effortlessly West Indies smashed the required 19 runs off just four balls thanks to Carlos Braithwaite’s four consecutive sixes.
And who was the bowler to cop the thrashing?
Yes, the same Ben Stokes who now holds the IPL record for the most expensive international player ever and is considered a supreme death bowler with great batting and fielding abilities. Yuvraj Singh even predicted, or rather prophesied, glory for Ben Stokes in the IPL auction.
Ben Stokes has shown what a difference one year can make!
But the questions that will be uppermost in his mind as also in the thinking of his team owner are –
Can Ben Stokes go back to being a bowler who gets hit around the park? Will he fail as a batsman? Will he click like he is expected to click when he was bought for Rs 14.5 Crores?
Sadly, no one knows at this stage, not even Ben Stokes himself!
Rajasthan Royals’ low cost model
In the augural 2008 IPL edition, Rajasthan Royals proved, contrary to the estimates of the experts, that it was possible to leave out the expensive players and still go all the way.
Admittedly, the low cost model may not always work out, at least it didn’t for Rajasthan Royals. However, the challenge for teams is to buy a player at just the right price rather than go straight for the big names and snap them at expensive prices.
It’s the same with financial products
Going for expensive investment and insurance products does not make a great deal of sense, financially speaking. Just like an expensive IPL player has to really set the field on fire every time or most of the time, to justify his price tag, an expensive financial product has to really deliver amazing results most of the time to meet the investor’s expectations. Given that financial markets are about as uncertain as T20, if not even more, that kind of blazing performance month on month or year on year is not possible for money managers.
Affordable insurance gives you bang for the buck
Life insurance does not have to be expensive as many individuals believe. Some forms of life insurance like term insurance are affordable. They allow you to go for a larger life cover at lower premiums. Consider adding riders to the life insurance policy to beef up your life cover in case of specific events like onset of a critical illness, accidental death benefit, among others.
You will find the low cost insurance option far more suitable to your needs and the needs of your family. Think of IPL teams that pursue lower priced players and still feature reasonably high in the rankings and you have the recipe for successful financial planning and insurance management.
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#Note: All above figures are as on 31 March 2016