Over the past few years, daily fantasy sports, DFS for short, has grown in popularity by leaps and bounds. The DFS industry seems to grow exponentially and now has a net worth well in excess of a billion dollars. After securing an investment from Disney, DraftKings (review) alone has an estimated net worth of $900 million dollars, reported in 2015.
If you’ve never heard of daily fantasy, you’re not alone. Though just about every sports bettor is familiar with the season-long fantasy football or baseball leagues, the vast majority of these players haven’t yet dived into daily fantasy or realize that it can be done legally by Federal law for real money. Some estimate that only 10 percent of yearly or season-long players have ever tried daily fantasy sports (DFS).
DFS has plenty of parallels to sports betting and poker. Many of the top DFS players have a background in both. Oddsmakers’ lines are an important tool for just about any decent DFS player. Most importantly, daily fantasy sports are fully regulated and legal in the United States, and players can deposit and withdraw with PayPal and credit or debit card without any problems
What Are Daily Fantasy Sports?
DFS leagues are daily fantasy contests for real money that are generally settled after the day’s slate of games has finished. It’s slightly different in NFL daily fantasy leagues, where the slate usually encompasses at least Sunday through Monday games, and sites even offer contests that run Thursday–Monday. In addition, some sites will also offer leagues that run over several days for other sports.
The big difference between daily fantasy and season-long fantasy is that there isn’t the traditional draft process that bettors have become accustomed to. Some DFS sites may offer a snake draft option, but the vast majority of contests that are played are salary cap leagues. A price will be assigned to each athlete in the site’s database when the contests open. Once the prices come out, and the leagues are joinable, prices will not change, even if new information (such as a player injury) emerges afterward.
Each DFS player must completely fill out their roster without going over the salary cap. Depending on the sport, the size of rosters may vary, but the only requirement is that each roster spot is filled by the start of the first game of the slate.
Those who have played online poker will immediately feel at home when they open their daily fantasy site of choice. The contest lobbies on DFS sites look and feel almost exactly like an online poker lobby, more specifically, a sit-and-go tournament lobby.
Joining contests from the lobby can be done simply and in just a few clicks. Like SNGs, players will have the opportunity to withdraw their entry provided the contest hasn’t started or been completely filled. For instance, when joining a 3-man league, players can withdraw their entry if just two players have joined. If you sit in or create a head-to-head contest, you can abandon the game provided no one else has joined. Once the league fills, players are locked into that contest.
Once players begin to pick up the industry lingo, they will understand that there is a difference between “cash games” and “tournaments”, which are otherwise known as guaranteed prize pools (GPPs).
For the most part, cash games are head-to-head or 50/50 games. In h2h contests, it’s only one opponent that must be beaten, and in 50/50s or double ups, players only have to finish in the upper half of the field. In these contests, players will double their money (minus the contest fee).
Some sites offer “triple up” and 3-man leagues, which are winner take all as well (tripling the winning players’ money, of course, minus the contest fee), and that just scratches the surface. There are tons of variations in prize pools and league sizes when it comes to cash games.
The general idea for cash games is to maximize your floor. Players should be looking to roster guys that will get consistent points since their goal is usually to beat 1–2 opponents or simply finish in the upper half the field. The upside is nice but isn’t necessary for these contests.
Targeting high-floor players will vary depending on the sport, but the concept remains the same. Get yourself a nice base of points and forgo the hit-or-miss guys that may have a higher ceiling but lack consistency.
Cash games are the lifeblood for most players and will earn them the most money long term, but it’s the large contests that get the most press. Accordingly, prize pools for large-field tournaments have increased rapidly in recent years to attract more players. These tournaments are full of thousands or tens of thousands of players and have large prize pools.
For instance, DraftKings ran a “Millionaire Maker” contest each week of the 2014 NFL season, where they gave away a top prize of $1 million. Second place received $100,000, and there were hundreds of other places paid too. Fantasy betting sites like Fanduel (reviews) or lesser known FantasyAces (review) also offer championship series tournaments for each sport, which involve multi-million dollar prize pools and may be held in places like Las Vegas or the Caribbean.
The mindset for beating a field of 20,000 or more versus beating an individual opponent differs substantially. Large tournaments are where you shoot for the moon. Instead of going for safer, high-floor players, like in smaller contests, you want to maximize your upside and search for players with high ceilings that have the potential to achieve 4x their price.
Another factor to consider when playing tournaments is how highly owned a player is. Fading a clear value or an excellent matchup in cash games isn’t usually advisable. However, there’s plenty of merit to this strategy in large-field tournaments.
If a highly owned player fails to produce (as they often do), bettors that have faded that player and don’t have them on their roster can gain an advantage in a large field. The lesser owned a player is in tournaments, the more valuable they are if they happen to have a big game.
Sometimes the matchup is simply too good to ignore, even when it comes to the contrarian strategy of large-field tournaments. It’s certainly fine to roster a player you think will be highly owned in a large field if you’re in love with the matchup. However, realize that you will have to hit it big with your lesser-owned players because a large percentage of the field will also benefit from a big game from the highly owned player.
Due to UIGEA regulations, daily fantasy sports sites cannot alter their prize pools based on the number of entrants. This creates a lot of dead money and potential overlay if a tournament doesn’t fill. Even with the increased popularity of DFS in recent years, there are tens of thousands of dollars in overlay across the industry pretty much every night of the year.
Many experienced players will hold off joining some leagues until shortly closer to game time to look for contests with large overlays. This is an excellent strategy and one that will no doubt increase their bottom line.
As mentioned with cash games, the above paragraphs just touch on the basic strategy for tournaments. Each sport will have its nuances and specific strategies. In general, the idea is to target players with a high ceiling and those that others may overlook or that you suspect will have a low owned percentage.
Similarities and Differences Compared to Sports Betting
Some say that daily fantasy sports are, in some ways, a form of legalized sports betting. That may seem like a bit of a leap, but it’s hard to argue that DFS isn’t at least somewhat similar to sports betting. After all, DFS is essentially based on gambling on the individual performances of players.
Though sports betting is generally centered on two teams competing (point spreads and moneylines) and the number of points scored in each game (totals), sportsbooks also offer proposition bets, and player props are markets where bettors can also wager on the performance of individual players.
Sports bettors should have a leg up on the competition in daily fantasy due to their experience in handicapping. Though there are some crucial differences, the parallels between sports betting and DFS are certainly there.
For these reasons, it’s ridiculous to think that the two activities are starkly different. However, one is labeled gambling and dangerous to society while the other is openly accepted and regulated in the vast majority of US states. The laws regarding these two activities are clearly hypocritical, but that’s the reality in today’s climate.
Because of the legal environment, there are risks with gambling at offshore sportsbooks. Foreign online poker operators are still heavily targeted by the Feds. In 2013, the government indicted several employees of Legends Sportsbook, and a site that had serviced US players for over a decade was forced to shut down. Players did receive their balances back but were forced to play them at another sportsbook (after a bailout deal was brokered) with a 5x rollover attached.
The fortunate part is that those customers were lucky to have the balances returned plus the rollover. Many offshore gambling sites go broke without government inference, and customers are left without their bankrolls. There are more reliable options than others, but in the current climate, all US-facing foreign gambling sites are at risk.
Since daily fantasy sports are legal, such risks aren’t a worry. Player bankrolls are safe, and there is no worry about the government seizing player funds. The biggest daily fantasy sites are all based in the United States.
With regulation also comes the ability to deposit with ease using a number of options, including PayPal and almost all forms of credit and debit cards. This also improves cashout speeds. Most sites process withdrawals back to PayPal in less than 24 hours. There are also no fees for deposits and withdrawals in almost all cases.
Playing Against the House?
One of the most significant differences between sports betting and DFS is where the money that you’re winning is coming from. In sports betting and casino gambling, it’s the player vs. the house. Because of this, your upside and earnings in sports betting will always be capped at an individual sportsbook.
Since they have the right to refuse your action and limit the amount you can bet, there’s always a certain point where they will have had enough if a particular player begins to beat them for decent money.
DFS, however, is similar to poker in that winnings are derived from other players, and the house merely takes a percentage in exchange for a place to play. Sites in the DFS industry will typically charge a 10 percent fee on contest entries. This, of course, is the same fee that sportsbooks charge on a standard straight wager (the vig or vigorish). Most daily fantasy sites also charge players a slightly smaller percentage in rake as contest buy-ins get larger.
Because players are not winning money from the house, like they would be in the case of sports betting or casino gambling, issues of getting your betting limits cut or getting cut off entirely because you’ve taken too much out of the sportsbook’s coffers isn’t something that plagues daily fantasy players. Sites will never cut off users for winning too much. If you’re winning on a nightly basis, the sky is the limit in terms of earnings.
Bonuses and VIP Programs
Like just about every online gambling site, DFS sites almost universally offer a deposit bonus for new accounts on their first deposit. It’s also not uncommon for them to offer reload bonuses. Reloads bonuses are becoming less frequent these days but usually coincide with the start of a professional season, such as the NFL’s Opening Kickoff or the MLB’s Opening Day.
One of the biggest differences that players will notice compared to bonuses with other forms of gambling is that DFS bonuses will take much longer to clear. Players will not receive their bonuses up front, but instead, the bonuses will be slowly released as players join real-money leagues.
Bonuses can take quite a while to clear, and players may need to redeposit if they have a bad run of luck early on in their DFS career. Since the sites make their money from tournament fees, players won’t rollover their bonus by the league buy-ins but instead with the contest fees.
Rollover rates vary, but players have to join a lot of contests to clear their bonuses. However, at most sites, the bonus amounts to about a 1% reduction in contest fees until players clear it. DraftKings gives players four months to clear their original bonus, but FanDuel allows users the lifetime of their account to clear the first deposit bonus.
While clearing bonuses at DFS sites will take much longer than clearing freeplays at most online sportsbooks, one area DFS sites have sportsbooks convincingly beat is their VIP Programs. VIP programs at sportsbooks in the US market are rarely offered and even when they are, they offer little value. For players to get extra bonuses or comps, they almost always have to lose a bunch of money first.
That’s not the case in the DFS industry. Nearly every DFS site offers some sort of rewards program. Players will earn points for every contest they join and will be able to use their points for rewards and contest tickets. Some sites offer a VIP store where players can buy luxury items and turn in their points for trips to exotic locations.
The VIP programs at DFS sites won’t make up for a losing streak, but they’re a nice bonus for players who are putting in decent volume. They are certainly better than nothing, which is what players receive in terms of rewards at most offshore sportsbooks.
Utilizing Sports Betting Knowledge
Those who are familiar with sports betting and understand betting lines will have a distinct advantage compared to those that don’t utilize sportsbook odds when building their daily rosters. As we know, the bookies have to get things mostly right, or they will be out of a job or bankrupt.
That’s why using betting lines to target players in DFS is extremely useful. In fact, I think it may be the most important factor to consider when evaluating the slate for each sport. If you’re not factoring in the oddsmakers’ lines into your lineup-building routine – you’re making a huge mistake.
Here’s the best part about using betting odds to determine which players to use in daily fantasy – there’s no line movement. If the Patriots open as -7.5 favorites against the Jets and the line moves to -10 closer to game time, this change is not reflected in DFS pricing. Once player prices come out, they don’t change.
In sports betting, if you miss a line move, the value of that wager is sometimes immediately lost. Finding market inefficiencies is difficult, and like I mentioned above, players are often banned or limited if they chase steam moves and attack vulnerable markets.
The use of betting lines in DFS is almost limitless. Totals and team totals can be used to predict the number of points scored in each game. Player propositions can also be used to predict individual performances. Large line movements that are interpreted as smart money can be utilized by taking players on the side Vegas likes.
Perhaps, most importantly, the Vegas lines will be an excellent baseline for your research, saving you time and helping you focus on the games you want to target. There’s no better way to get an edge in daily fantasy than using betting lines. Use sports betting odds and knowledge to crush your opponents.
Author: Joseph Falchetti
Copyright: 2017 OnlineBetting.com