Nylon Calculus: Adjusting NBA team ratings for strength of schedule

The first month of the 2017-18 regular season has been filled with surprises. The Boston Celtics (14-2) own the best record in the NBA despite Gordon Hayward’s injury. The Indiana Pacers (8-8) and New York Knicks (8-7) have better records than the Oklahoma City Thunder (7-8), even after trading their stars to the Thunder. And the Golden State Warriors are “only” on pace for 60 wins.

But team records don’t tell the full story. For example, the Oklahoma City Thunder might be a below 0.500 team right now, but they have the fifth-highest point differential in the league. The New York Knicks are above 0.500, but they’ve played 10 games at home (7-3) and only five on the road (1-4). And the Cleveland Cavaliers might be back in the playoff race again, but aside from the Celtics, their wins haven’t been against the most competitive teams: Clippers, Hornets, Knicks, Mavericks, Bucks, Wizards, Bulls, and Bucks.

After just one month, each team has an extremely varied schedule thus far with an uneven balance of home/away games and strength of opponents. We can address this with a regression; each game represents an observation, and each team has two variables — offensive rating and defensive rating. An additional variable is included to represent homecourt advantage.

The output is offensive rating and defensive rating for each team, adjusted for their opponents’ strengths thus far and homecourt advantage. Here are the results (full table at the bottom):

Immediately we can see how much the Golden State Warriors stand out. Again, they have the best offense in the league by a significant margin, and only the Boston Celtics have better defense. Their 11-4 record may not sound as impressive, but they’ve faced the strongest opponents thus far and still had decisive margins of victory.

We haven’t heard much about the Toronto Raptors this season, but they’ve quietly been a top team as well. Sixty percent of their games have been on the road, and that includes victories over teams like the Houston Rockets and Portland Trail Blazers. Their adjusted net rating is actually higher than that of the Celtics. Of course, the Raptors are known for playing at a high level in the regular season and then underperforming in the playoffs.

This method still isn’t perfect; injuries are completely ignored, and days of rest aren’t accounted for. Teams who made major offseason moves will gradually improve over the course of the season as they develop chemistry and new players get acclimated. Nevertheless, the method filters some of the scheduling noise and gives a cleaner view on how each team is doing so far.

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Here’s the full table with adjusted offensive ratings, defensive ratings, and net ratings for each team:

The numbers listed here do not include results from Sunday’s games.