July 2 of each calendar year is the day that MLB holds their new crop of 16 year old international prospects from most Latin American countries. The risk can be a bit higher as these are much younger, less-developed players than are drafted through the Rule 4 MLB amateur draft, but the reward is still obtaining top tier talent at discount prices when they do pan out.
The Cleveland Indians have thus far signed Jose Fermin (SS, Dominican Republic), Henry Pujols (3B/OF, Dominican Republic), and Luis Oviedo (RHP, Venezuela).
Here are the curret rules as we described earlier this season (If you follow the link, then you can also see some advantages and disadvantages of the current system.).
International Prospect Signing
Current rules1 :
The International signing period begins on July 2 each year. International players 16 years of age and above are eligible to be signed and each team is given a slotted pool of money to sign international players based on reverse order of major league winning percentage from the previous season. To complicate matters, teams are allowed to trade for up to a 50% increase in their bonus pool money. To further complicate matters, the penalty for going over your bonus pool is to hard cap the amount you can sign an individual player the next year, but the team still gets their slotted pool of money for trading purposes2.
Due to MLB clubs targeting players at even younger ages, there was an additional rule placed in 2014. International players are not allowed to be at a team facility until they are 16 years old or until six months before they become eligible to sign, whichever comes first. You know, so that a team cannot give a prospect like Vladimir Guerrero Jr. the Reggie Bush Treatment while he is young so that he will sign with them once he is eligible3 .
For 2015, the Arizona Diamondbacks, Boston Red Sox, New York Yankees, Tampa Bay Rays, Los Angeles Angels of Anaheim were under signing restrictions due to going over their slot in previous years. Again, these teams are free to trade their bonus pool money. The actual amount of money avaiable to each year is determined by the inverse order of winning percentage from the previous season. As such, the Cleveland Indians have $2,204,900 available to them, which was the 19th most in MLB.
International signings usually continue through most of July, though the top picks tend to sign quickly. In fact, 29 of the top 30 prospects according to Baseball America are already signed.
Jose Fermin was the 28th ranked prospect on that list (signing money not yet disclosed). He is a 16 year old who is currently 5-foot-11, right-handed, and expected to be able to stick at shortstop (many shortstop prospects end up switching positions as they progress upwards in the minor leagues).
Henry Pujols was not listed in the top 30 prospects (signed for $600,000). However, he is a 6-foot-2, 200 pound, right-handed bat with incredible potential for power. He will likely have to move to a corner outfield position as his defense is not lauded at third base, but power-bat corner outfielders are always in demand.
Luis Oviedo was also not listed as a top 30 prospect(signing for $375,000). At 6-foot-3 though, the 16 year old has already touched 90 mph with his fastball, and he has an advanced changeup.
The general consensus thus far is that the Indians went for some players that may wind up being considered bargains due to their high ceilings. The risk is that there is often a reason that players are in the bargain bin. Time will tell if the Indians made prudent signings.