Baseball May Get a Playoff Team With a Losing Record. The Average Was Never the Point.
The division champion gets the bye. The two best teams get a coin flip. And the best team in the league gets rewarded with an early series against one of them. It is the most accurate picture of a capitalization-weighted index you will read this weekend.
By Sean Anees Saifi · Capital Wealth · Published Saturday, September 19, 2026 · Source: The Wall Street Journal, September 19–20, 2026 weekend edition, whose market figures are the Friday, September 18 close
Key Points
The Chicago White Sox and Cleveland Guardians entered Friday tied atop the AL Central at 78-75; the Houston Astros led the AL West at 77-76. The worst team ever to make the playoffs in a full season was the 2005 Padres at 82-80.
All five AL West teams have allowed more runs than they scored; three fired their general managers midseason. The Seattle Mariners, one win from the World Series last year, collapsed — Cal Raleigh followed 60 home runs with a batting average under .200.
Under the 12-team format adopted in 2022, division champions get preferential seeding: the White Sox would go straight to the best-of-five division series with the league’s fourth-best record, while the Yankees and Red Sox, second and third, meet in a best-of-three wild-card round.
The Tampa Bay Rays, the AL’s best team on a low payroll, get an early series against the Yankees or Red Sox while two worse teams meet on the other side of the bracket.
Randomness reigns: the 2006 Cardinals went 83-78 and won the World Series on an 11-5 postseason tear. The larger worry, per the Journal: a sub-.500 champion.
78-75
the AL Central leaders’ record entering Friday
82-80
the worst playoff record in a full season, 2005 Padres
5 of 5
AL West teams outscored by opponents
11-5
the 2006 Cardinals’ postseason after an 83-78 season
“Somebody has to win those divisions,” the Journal writes, “and the bizarre nature of the standings is going to lead to a weird October.”
In one line: A format that rewards the division rather than the record produces a champion nobody would pick, which is also what happens when an index rewards size rather than quality.
Making the playoffs in Major League Baseball is supposed to be a mark of excellence. Then there is this season. The White Sox and Guardians entered Friday tied atop the American League Central at 78-75. The Astros led the AL West at 77-76. The worst team ever to qualify in a full season was the 2005 San Diego Padres at 82-80, and Jared Diamond writes that the distinction is “in serious danger of falling.”
The AL West may be the worst division in baseball history. All five teams have allowed more runs than they have scored; three fired their general managers during the season. The Seattle Mariners, one win from the World Series last year, collapsed — Cal Raleigh followed his 60-home-run season by hitting under .200. The last-place Orioles have a better run differential than the entire AL West.
The format is the story
Baseball’s playoffs grew to 12 teams from 10 in 2022, and division champions get preferential seeding regardless of record. So if the season ended today, the White Sox would skip straight to the best-of-five division series with the fourth-best record in the league, while the Yankees and Red Sox, second and third, would square off in an unpredictable best-of-three wild-card round. The Tampa Bay Rays, the league’s best team on a low payroll, are rewarded with an early series against one of those two, while two far worse teams meet on the other side of the bracket.
Diamond’s honest conclusion is that randomness often reigns: the 2006 Cardinals went 83-78 and then 11-5 in October to win it all. The Reds sneaked in at 83-79 last year and were immediately trounced. And baseball has a worse possibility to worry about than a sub-.500 playoff team. It could have a sub-.500 champion.
Our read
We put a baseball story in a Saturday financial paper because it is the best description of a capitalization-weighted index we have read all week. The S&P 500 closed Friday 1.9% from a record, up 11.8% on the year. The Value Line index of the typical stock is up 4.2%. New 52-week lows outnumbered new highs 182 to 29. The division champion — the largest ten companies — gets the bye, and everyone else plays a coin-flip round. The average is at the top of the standings. The average team is not.
A format that rewards the division instead of the record produces a champion nobody would have picked on merit, and the format is not going to change before October. An index that rewards size instead of quality does the same, and it is not changing either. The answer in both cases is not to complain about the format. It is to know what the standings actually measure before you bet on them, which is why the equal-weight index is the first purchase on the reserve’s shopping list, and why the desk grades its own book on the average stock, not the average.
What It Means For Your Portfolio
Hold — know what the standings measure before you bet on them
A format that rewards the division rather than the record produces a champion nobody would pick on merit. So does an index that rewards size. Know what the standings measure.
General planning principles, not advice for anyone in particular. A cap-weighted index fund is a fine core holding and it is also a format: the biggest names get the bye. This year the S&P is up 11.8% and the typical stock 4.2%, which is the difference between the champion and the league.
The equal-weight S&P 500 fund (RSP) is the first purchase written on the reserve’s list at an 8% drawdown, precisely because it pays the league rather than the division winner. Written in September; unchanged by a quiet Friday.
