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Early Season DFS Strategy: Risk Assessment

Looking at daily fantasy bankroll management

Earlier this summer, FootballGuys released two separate E-Books (available FREE to InsiderPro subscribers), entitled “Cracking FanDuel” and “Cracking DraftKings”. These books were a collection of wisdom shared by members of our staff, many of whom were on the ground floor of daily fantasy sports and have experienced a tremendous amount of success. Our intention was to not only shorten the learning curve for those who might be new to DFS, but also share advanced strategies that would help players of all skill levels improve and in turn, become more profitable.

One of the more interesting topics related to early season strategy, specifically, bankroll management. The central theme in this chapter had to do with the uncertainty that surrounds the first couple weeks of the NFL season, and how that uncertainty increased variance.  For context, I’ve listed several memorable quotes from this chapter.

“I believe you should limit your exposure in the early weeks. Wait for defensive strengths and weaknesses to show themselves and provide the data needed to exploit matchup-pricing inequalities. In the first four weeks of the season, I suggest risking only about a quarter of the amount you'd typically wager later in the season. Trends will emerge and you will have ample opportunity to leverage more of your bankroll when your edge is greater.”—David Dodds

“Bankroll management is critical early in the season. Self-restraint can be difficult when you have been waiting eight months for the game you love to get back on the field. But you must avoid digging yourself into a hole or busting your bankroll early. Wait for exploitable trends to emerge before you risk a high percentage of your bankroll.”James Brimacombe

“DFS takes skill, even in the early weeks. Some people will have a greater expectation than others. However, even if a fantasy owner has a positive expectation in the early weeks, it’s likely to be less positive than in later weeks. Therefore, wagering a lower-than-normal percentage of your bankroll in the early weeks is warranted.”Maurile Tremblay

As you can see, the consensus among many of our writers was that the first few weeks were landmines, and those landmines were looking to blow up your bankroll.  James made an excellent point when he referred to the excitement that surrounds opening weekend.  Often times that excitement can bleed into your subconscious and make you want to put more of your bankroll in play.  For many of the reasons listed above, the optimal, one size fits all strategy is to limit your exposure in the early weeks and wait for more exploitable situations.  With each passing week, sample sizes become bigger and thus, projections become more accurate.  If your style of play is anything but super aggressive, I suggest you follow this advice and take a conservative approach for the first few weeks of the NFL season.

But For the Apex Predators of the DFS world, the type of player who doesn’t wait for an opportunity, but rather creates them, the early weeks represent a tremendous opportunity to take advantage of uncertainty. “Contrarian” is a word used to describe plays that go against the grain, or involve a large amount of variance. It can also be applied to strategy though, and in this case, an aggressive approach to weeks 1-3, is certainly contrarian.  While many of my counterparts agreed with a conservative and patient early season approach, I am on the other side of the fence and have found the benefits of an assertive strategy outweigh the risk.  It is akin to speculation in the stock market, or thriving in chaotic environments. The most important fact to remember is that despite a high amount of variance, you are still competing against other players, and the number of winners is the same in week 1, as it is in week 12.  I define aggression as stretching your weekly bankroll limits by increasing the number of entries into your tournament of choice, but not increasing the dollar amount of that buy-in.  The idea is to give yourself more opportunities to be successful, and that only happens if you are able to increase the shares you have in player, or increase the players you have shares in.  

There are several elements in play that have tilted the wheel for me in favor of early season aggression.  The first has to do with the type of contests I apply my aggression to.  Even for the biggest risk-takers, I would caution against a high volume of cash games.  The key to winning cash games is building balanced rosters that do not employ many risk-reward scenarios.  If we know that even the most stable players experience a higher degree of variance in the early weeks as opposed to later in the season, it makes sense to decrease your cash game exposure. 

On the flipside, GPP’s are an exercise in risk taking.  You cannot win a large field GPP without taking a gamble on players that you perceive will be low owned.  With each passing week, it becomes progressively harder to find players that will be both low owned, and outperform their salary by a 4x-6x multiple.  In addition, the total score needed to win a GPP increases proportionally as well. 

Given these facts: 

1.) Other players will be more aggressive as the weeks go on (and sample size increases)

2.) Injuries will shrink the player pool in later weeks

3.) Bye weeks later in the season will also shrink the player pool

You are better off being aggressive with a smaller sample size than you are being aggressive with a large sample size.  

The bottom line for me is that if you are not putting 100's of entries into your contest of choice --and others are-- you are better off increasing your entries in weeks where you can match the entries of otherwise aggressive players.  In my opinion, the early weeks of the NFL schedule give you that opportunity. The beginning of the season rewards foresight, but it also rewards those who are willing to take risks. There are arguments to be made for both conservative and aggressive strategies, but what it really comes down to is how you categorize yourself as a player. Dan Hindery summed it up very well with the below quote.

“If you are highly analytical and build your lineups based on projections, it makes sense to go light in the first quarter of the season until you have more reliable data. If you are more observational than analytical in your approach, it may be correct to be more aggressive early.”—Dan Hindery