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Note also that Draft Pick compensation in OOTP doesn't work the same way as in real life. The first half of the first round is always protected; these picks are never awarded as compensation. So if a bad team signs your Type A free agent, you can't get their first round pick. In real life, you'd get their second rounder (and sandwich picks), but in OOTP you actually get nothing. Well, not quite nothing- you get an email saying you'll get a compensation pick. But just the email, no draft pick.
There's another potential issue when you lose a free agent. Say you lose a type B free agent to Montreal, but they sign another type B free agent from another team. Montreal's second round pick can only go to one team (I think it depends which guy they sign first), so you only have a 50-50 shot at a pick in this case. In real life, obviously you'd get something, but in OOTP, unfortunately no.
For this reason, some people disable compensation altogether. I find it creates more of a challenge to leave it on; if I sign a big free agent, at least I'll lose something (unless my team is bad), and if I lose a free agent, I might get nothing in return. So more of a challenge, but perhaps also more frustration!
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