Diary of a DFS Novice: DraftKings Introduction

This is my first post in a weekly series that will act as a diary of sorts, chronicling my journey into daily fantasy football. My focus this season will be on DraftKings, while my colleague Anthony Amico will be covering FanDuel.

Firstly, I’ll admit that this is not my first time with daily fantasy football. I dipped my toes in the water last season, and enjoyed some success at a very low volume. This season, I’ve decided to shift my time commitment over from mostly seasonal, to daily.

I have deposited $1,000 into DraftKings (which is offering a free $600 deposit bonus if you sign up today), which will act as my bankroll for the season.

This weekly series will include a review of my previous week’s strategy and performance, and include things I learn along the way as I try and make the most profit possible in the 16 regular season weeks (I’ll probably avoid week 17 and playoffs).

For my first week, I feel like the only thing that came easy was building my lineups. Before I could get to that stage though, I had to overcome three fears about diving in to daily fantasy football.

Fear #1: Bankroll Management

Knowing how to manage a bankroll seems like a pretty simple idea. Don’t have all your money in-play in the same week, and leave yourself some money to play in the future. So I was surprised when I did a Google search for “DFS bankroll management.” I came across a few articles which led to a several hour binge reading session on the topic. To save you some time, if you’re looking to get right to the information, check out this article by Jonathan Bales, or this one by Justin Bailey. They are two of the best in the business who (luckily for us) spend a lot of time sharing their experiences and strategies.

Kelly Criterion

A formula that helps to determine the optimal bet sizes to maximize profitability, the Kelly Criterion was my basis for forming a bankroll and money-in-play strategy. You can find more on this theory here.

First I had to determine what my expected winning percentage was. Using my DK data from 2014, where I cashed in 34 of the 52 contests I entered, I came up with a 65 percent winning percentage. For the sake of realistic accuracy, I knocked that down to 60 percent, since it was a limited sample where I chose specific weeks and contests where I felt the most confident about my chances and lineups. There was no consistency to my volume or strategy, so I think it would be far too optimistic to expect 65 percent this season.

Plugging that in, along with a 9-to-11 payout ratio, I came up with 11.1 percent of bankroll being my money-in-play budget. Because I’m only entering contests 16 times this season, I rounded up to 12 percent.

Side note: Many suggest taking only 50 percent of the number that Kelly Criterion gives as your money in-play figure. If I were playing daily fantasy NBA or MLB (or NHL), I would have definitely heeded that advice. But since this is a weekly event, I’m sticking with the 12 percent number.

Fear #2: Deciding on Contests

Browse around the web and you’ll find a million different opinions on which games to play. The obvious answer is to play the games that afford you the maximum ROI. Unfortunately my limited playing history makes that tougher, so I’ve relied on the advice of others to take the 80/20 approach. Eighty percent of my money in play towards cash games, 20 percent in tournaments.

Where I am differing in my strategy from my colleague Anthony is that I plan to have head-to-heads be the foundation of my cash game allocation, and limit my exposure in 50/50s. The payout ratio is better in 50/50s, and my history with them is good, but I am trading the chance to grow my bankroll faster for the safety of limiting my variance. I won’t go too much into this, because Jonathan Bales did so thoroughly in this article.

So I’ll be splitting my cash game allocation 75/25, in favor of head-to-head games. However, this is where in-season review of my ROI will be important, as I’ll evaluate weekly and shift this depending upon success and ROI.

Fear #3: Lineup Submission

I get the basics: Be contrarian in tournaments, and play for the high-floor in cash games. To continue my spree of quoting Bales, it’s not about creating a lineup to score the most points; it’s about creating a lineup that gives you the best winning probability.

Easier said than done, though. Tournaments seem simple enough – take my GPP allocation funds, enter the lower buy-in tournaments with as many contrarian-focused lineups as possible and hope to score big with at least one.

But what about in cash games? Do I have the same lineup for every H2H match? Do I have multiple entries for a single 50/50? These were two questions that I struggled to find answers to.

The beauty of H2H is that even if you enter the same lineup across all of your matchups (which I probably will), the matchup itself against a single opponent acts as diversification, making multiple lineups unnecessary. This allows you to focus on optimizing a single lineup. If that lineup finishes in the 20th percentile, you’ll still win 20 percent of your H2H matchups. In a 50/50, that same lineup would lose 100 percent of the time.

For 50/50s, I plan to avoid multiple entries into the same contest, and instead submit my best 1-3 cash game lineups over a few different contests. This helps keeps my variance low, and hopefully the increased payout percentage will negate a few losses.

Let The Games Begin

I’m excited to document this journey here on RotoViz, and share it with those of you who might be following along in a similar fashion. Each week will include a performance review, but more importantly I’ll explain key learning’s that will (hopefully) make me a better player with each week.