I spotted this whilst having brekky this morning and thought it was worth a bit of analysis. It is a list of the worlds highest paid athletes which in itself is interesting from a voyeur’s perspective.- Forbes lists 100 athletes but I cut the list down to the top performers.
The top performers are shown below.
Whilst this gives us a bit of basic information it doesn’t tell much of a story so I decided to graph their total income as a function of salary (performance) and endorsements (non performance related income)
We can now easily see the differences in performance related incomes versus non performance related income. So I decided to build an effectiveness ratio, that tracks the percentage of an athletes incomes as a function of the ratio of total salary to performance income alone.
According to this the most effective athlete in the world in terms of the ratio of total income to performance related income is Floyd Mayweather and the least effective is Tiger Woods. That is Mayweather gets paid a truckload for performing well and Woods gets paid a lot for doing badly. Which intrigues me because when I first saw this I thought that ponce David Beckham aka the worlds most over rated footballer would have been the least effective.
To put this into trading parlance Mayweather is your archetypal individual trader – everything he earns is down to his own ability. Whereas. Woods is your average US executive, run the company into the ground and still get paid a shitload.
