What PECOTA is and why you shouldn’t freak out about it

Baseball Prospectus’ annual PECOTA predictions come out today and have been trending on Twitter all afternoon. This is perhaps the biggest day of the year for Baseball Prospectus, as the predictions will be covered wall-to-wall on blogs and timelines across the web. Since every other site on the internet is getting into the PECOTA predictions themselves, I feel there is need for some context on the subject.

PECOTA, or the Player Empirical Comparison and Optimization Test Algorithm, was a system perfected by stats guru Nate Silver for Baseball Prospectus in 2002. This system has three factors: Major league equivalencies, which take into account minor league stats as a factor in future…