A Smart Bankroll Strategy to Profit in Daily Fantasy Football
Let's not sugarcoat things: the first key to being profitable in daily fantasy football is being good at it -- or at least, a little better at it than your competition (and as Paul Pierce would say, that's why they got me here) -- but even the best players will still lose at least a third of the time in cash games, and much more in tournaments, so bankroll management is just as crucial.
There's no one-size-fits-all DFS bankroll strategy, but in the following article I'll go over some general principles to intelligently manage your daily fantasy bankroll.
How Much Money Should You Play?
In a given day, it is not advisable to play more than 20 percent of your bankroll. This number can be much less, especially if your bankroll is higher.
The important part with money in play is to be consistent. If you're not consistent with your percentage of money in play, you run the risk of being a winning player yet not being profitable.
For example, assume you have a $100 bankroll and play 20 percent ($20), all in double-ups, and win them all. Now your bankroll is up to $120, and with extra confidence, you decide to play 50 percent ($60) of your bankroll the next week, but you lose all of your games. Now you're left with only $60, so the following week you get scared and go back to playing only 20 percent ($12) of your bankroll, but alas, you double up again, winning $24 to bring your bankroll to $72 after three weeks.
It's easy to see something's wrong there: you won big two out of three nights, yet your bankroll is smaller than before. If you had stayed consistent and played 20 percent each week, you would have made a nice profit. You would have only lost $24 the second week if you played 20 percent of your $120, ending with $96 rather than $60. Your money in play in Week 3 would have been $19.20 (20 percent of $96), and you would have ended up with $115.20. Despite having the same game results, just by being consistent with your money in play, you would have made a 15-percent gain on your bankroll instead of losing 28 percent.
When deciding on money in play, you also have to take into account how strong of a player you are. Most DFS sites allow you to download your results, so over time you'll get an idea of your baseline winning percentage in different types of games. The better player you are, the more money in play is acceptable. For more on optimizing your wagers and using the Kelly Criterion, check out Jonathan Bales's article on optimizing your wagers.
What Contest Types Should You Play?
Here's where it's crucial to understand your odds. Even if you play no more than 20 percent of your bankroll, putting the entire 20 percent in cash games -- low-risk contests where your odds of winning are roughly 50 percent -- is a lot different than putting the entire 20 percent into tournaments -- contests with top-heavy payout structures but with reduced odds of cashing.
In terms of bankroll growth, the best way to minimize risk while giving yourself upside is to put the majority of your money in play into cash games, and then using your cash game profits to "fund" entries into tournaments, where you have the chance to significantly increase your bankroll with as little as one big cash.
The general idea is to allocate money in play to cash games and tournaments in a way that if you win a good amount of your cash games but don't place in any tournaments, you can still profit on the day. An 80-20 or 90-10 cash game-to-tournament split is ideal.
What Type of Cash Games Should You Enter?
Different cash games have different odds of winning: head-to-heads have a 50-percent chance of winning double your entry fee minus the rake, while double-ups usually have just under a 45-percent chance of winning double your entry fee.
The safest strategy for cash games is to enter head-to-heads against a diversified sample of opponents. If you only play one opponent and that opponent has a great week, you could conceivably lose all of your money in play. However, if you play a diverse group of opponents, you will ensure that if you have a good score, your winning percentage will reflect that. For example, if you finish with a score in the 80th percentile among all scores on the site in a given week, you're likely to end up winning somewhere in the neighborhood of 80 percent of your head-to-head matchups.
Similar to playing head-to-heads against only one opponent, playing 50/50s and double-ups are riskier than you might think, especially if you're using only one lineup (I'll discuss lineup diversification next). For exmaple, if your lineup has a 49th-percentile score, you could lose all your entry fees if you played only 50/50s, whereas you would have still won roughly 49 percent of your games if you had played all head-to-heads against a diversified sample of opponents.
How Many Lineups Should You Use?
How many different lineups you enter and players you have exposure to depends on whether you're playing in a cash game or a tournament.
Cash Game Lineup Diversification
In cash games, you should generally opt to use a lineup consisting of the optimal values of the week with the highest floors. This dictates not diversifying too much, especially in head-to-heads. If you're playing a bunch of head-to-heads against a diversified sample of opponents, using only one cash game lineup is fine -- diversifying risk will be taken care of by the variety of opponents you're playing.
If you have multiple players valued similarly, you can diversify your lineups a bit, but don't do so simply for the sake of diversification. You always want to make the optimal plays in cash games, and being contrarian is not of much importance given the lack of a top-heavy payout structure. You can hurt your odds of profiting if you limit your exposure to a great value play and that play ends up being in the majority of your opponents' cash game lineups.
Tournament Lineup Diversification
In tournaments, both lineup and player diversification is key, for two main reasons:
- Your lineup needs to be differentiated from what is usually a large field of opponents in order to place highly in or win a tournament.
- Tournaments dictate the selection of volatile players, who by nature are less predictable, which means you need to account for a greater range of outcomes.
When you play tournaments, it's recommended to multi-enter them with different lineups if that's an option (there are some tournaments that are single-entry only, which requires a slightly less risk-seeking approach). You want to create lineups in such a way that they don't contain many (if any) of the same players. This way, you give yourself multiple shots at a huge score, while at the same time not allowing one bad play in all your lineups to sink you. As your bankroll grows, you can play more lineups with a similar core with greater diversification around it.
What Should Your Buy-in Level Be?
Generally, the lower the buy-in level, the easier the competition. The best way to use this to your advantage is to always enter the lowest buy-in levels you can with your money in play.
So if you're playing $50 worth of head-to-heads, your best chances of winning would be by entering 50 contests at $1 each, rather than five contests at $10 each, for example.
Do this within reason, however -- if you're not going to be able to manage 50 unique $1 tournament lineups, it's better to enter 25 at $2 each or 10 at $5 each instead. It makes the most sense to enter at the lowest buy-in level in head-to-heads and other cash games, because you won't be using many unique lineups.
How Do You Account for Variance?
It's important to understand variance, which is the naturally occurring, short-term up-and-down swings inherent in games like fantasy (and real) football.
Even the best DFS players experience swings of fortune due to variance, and while those swings will even out over the long run, you will have to remain afloat in the long run to benefit. In terms of the amount of games played, the NFL season is extremely short relative to other sports -- there will only be 17 weeks with a full slate of games each season (we advise being more cautious with your bankroll during smaller slates such as the playoffs). This brevity increases your odds of being affected by small-sample variance in the form of having results far better or worse than your true skill level.
Some daily fantasy players prefer to seek variance, playing mostly in touraments with contrarian lineups looking for the thrill of the big score. This is a fine preference, but just know that with large potential rewards come large potential risks. A DFS player primarily playing in large-field tournaments is more likely to lose in the short-term than a player playing solely in cash games -- especially if those cash games are restricted to head-to-heads against multiple opponents.
The Bottom Line
The safest way to grow your bankroll is to play no more than 20 percent of your bankroll in a week in the lowest buy-in levels possible, putting no less than 80 percent of your money in play into cash games, the majority of which should be head-to-heads against diversified opponents, with the rest of your money in play going towards in multi-entry tournaments.
Most importantly, you want to be consistent with the percentage of your money in play from week-to-week.
I mentioned earlier that there's no one-size-fits-all strategy; I simply described a good method to minimize risk while still exposing yourself to some upside. However, you can modify this strategy to fit your level of risk. For example, you could play 100 percent of your games in head-to-heads if you want the safest possible way to grow your bankroll. Or you could be a tournament-only player, but realize that you run the risk of an extended cold steak even if you're a good player. Think of it like a good hitter in baseball: even a career .300 hitter will have stretches where they go 0-for-20, etc.