Jonathan Bales is a DraftKings Analyst and the author of the Fantasy Sports for Smart People book series, most recently Fantasy Football for Smart People: How to Win at Daily Fantasy Sports.

“If you play a game where scrap pieces of glass are at stake, you will play skillfully. If your expensive belt buckle is at stake, you’ll start to get clumsy. If it’s your money that’s at stake, you’ll fumble. It’s not that you’ve lost your skill. It’s because you are so flustered by things happening outside that you’ve lost your calmness inside. Lose your stillness and you will fail in everything you do.”
  • Liezi

When I was thinking of writing this weekly article, Ethan—one of the dudes who runs Playbook—told me to think of a name for it. I knew I wanted to write about the philosophy of daily fantasy sports—and I knew I really like Taoism—so that was that. But I didn’t really think I’d concentrate specifically on Taoism all that much because it’s sort of like studying cosmology to become a better mechanic.

Except here’s the thing: I think reading Taoism can actually make you a much, much better DFS player, even if indirectly, by forcing you to think in creative ways that many people aren’t accustomed to doing.

By the way, that quote above doesn’t really have a whole lot to do with this article, but I really like it. I do think it’s true in a lot of aspects of life that we let outside factors determine our successes and failures so much. I do it, too. When I’m in a freeroll, I’ll play some ridiculous lineups that actually end up doing pretty well just because I’m not really scared about the results; when I’m in a $1,000 qualifier, it’s a lot more challenging to take those chances, even if I think it’s optimal.

Another Taoist tenant I like is the rejection of distinct dichotomies. Much of the philosophy is represented by the popular concept of yin-yang, which exemplifies “opposites” actually being complementary, giving way to one another and in many ways being so interconnected that they’re almost the same.

I’ve hinted at utilizing this idea in the past with the rejection of static median projections (or even ceiling/floor projections). What does it mean to say Mike Evans has a median projection of 15.0 points this week? That tells us very little about how likely he is to reach certain levels of production, which in my opinion is much more valuable for DFS play. Instead, we should be concerned about each player’s range of potential outcomes and matching up those ranges with our goals for each particular league.

There’s another area of DFS in which the norm has become a separation into a distinct dichotomy—a dichotomy I think needs to be rejected for good players to become great and great ones to become elite.

I’m specifically talking about the separation of “cash games” versus “GPPs.”


A Range of League Types

When I wrote my first book on daily fantasy sports, I very often referred to all head-to-heads, 50/50s, and three-man leagues as “cash games,” and all other leagues—whether it is a 100-man, the Millionaire Maker, or a qualifier—as “tournaments.”

I still use the term ‘cash games’ because people are familiar with it and also because the strategy in a head-to-head really doesn’t differ all that much from that in a 50/50. But I do think they’re different. And I do think we need to alter the way we characterize GPPs, too.

Instead of the distinct cash vs. tournament dichotomy, I think what we really see is a range of league types, separated by risk.

  • Head-to-Heads
  • 50/50s
  • 3/5-Man Leagues
  • 10-Man Leagues
  • Medium-Sized Tournaments (ex: 100-man GPP)
  • Large-Field GPPs (ex: Millionaire Maker)
  • Qualifiers
I’m going to work in reverse order. Qualifiers are extremely volatile because the top finisher wins almost the entire prize pool, typically in the form of a ticket to a larger league. Even though you need to embrace variance to win a tournament like the Millionaire Maker, it’s still less volatile than a qualifier. I think the strategy you employ in a qualifier should be extremely high-variance—even more so than in the Millionaire Maker—because the goal is to finish first and that’s it.

Between what we typically consider tournaments and cash games are medium-sized leagues. To be honest, I don’t really play these, but I do think it makes sense to be mostly risk-averse in three and five-man leagues and a little more risk-seeking in 10-mans.

But really what matters here with all these leagues is the payout structure, not necessarily the size of the league. DraftKings’ giant 50/50s have thousands of users, but they’re actually less volatile than a four-man 50/50. Despite what the girlies say, it’s not the size that counts; it’s the payouts.

Now we get to cash games. In both head-to-head and 50/50 leagues, the top 50 percent of entrants get paid. In terms of how much risk you’re taking on by entering each, there’s a lot less risk in head-to-heads—assuming you’re entering more than one—than in 50/50s.

That’s because head-to-heads pay out in a very linear way. If you enter 10,000 head-to-heads with the same lineup and finish in the 40th percentile, you’ll beat roughly 40 percent of people and lose to roughly 60 percent. You’ll end up having a relatively small negative ROI in that scenario.

Now compare that to entering 10,000 50/50s. Since you get paid solely when you finish in the top half, you’ll lose every single time. Multi-entering 50/50s is massively more risky than doing the same with head-to-heads.


More on 50/50s vs Heads-Up

Now here’s why I think we need to start differentiating a bit more between 50/50s and head-to-heads; because head-to-head leagues pay out in a linear manner, it can make sense to take on more risk and truly maximize your projected score.

Here’s an example. If you score 170 points half the time and 100 points half the time when the average score is 130, you’ll end up winning about as many head-to-heads as you would as if you score 135 every single time—probably a tad more than 50%. But if you score 170 points half the time and 100 points half the time, your 50/50 win percentage (50%) would be drastically different than if you score 135 every time when the average score is only 130 (100% win rate).

To me, this shows head-to-heads are contests of point-maximization—games in which taking on more risk is okay if the potential upside outweighs the downside—while 50/50s are games of risk-minimization.

This should actually have a pretty profound impact on the lineups we construct for each league type. In games of risk-minimization, I want players with a narrow range of potential outcomes, i.e. the typical “high-floor” players like Antonio Brown and Julian Edelman. In head-to-heads, however, I think the player pool is widened because we want the guys who will simply maximize the number of points we can score over the long run. That means I might roster Mike Evans in a head-to-head if he offers a lot of value, for example, while he would have to be severely underpriced to be worth consideration in a 50/50.


Insurance and Price-Sensitivity

To demonstrate this idea a bit better, I’m going to leave you with an analogy. I’m sitting in an airport right now and I just ordered a hot dog, and I’m going to try to finish this before the hot dog comes out. The race is on.

Think about why you buy health insurance. It isn’t because it’s a +EV investment. You’ll likely end up paying a lot more into your health insurance than you get out of it, which is how health insurance companies make money.

But health insurance is still a good idea because it minimizes your risk of ruin. If you have $1 million in the bank, it would be dumb to put yourself in a position in which one event could wipe out that savings; you will overpay to minimize risk in that situation.

It’s the same thing in 50/50s. You don’t need to be as price-sensitive as you do in head-to-heads because the goal isn’t point-maximization; risk-minimization is more important.

Playing head-to-heads, on the other hand, is sort of like Bill Gates making a decision about health insurance. He really doesn’t need to worry about his risk of ruin because he has so much money. Nothing could happen in terms of his health that would wipe out even a small fraction of his net worth. He probably has health insurance because, well, who really gives a shit? But if Gates’ goal were to truly maximize his projected net worth, he wouldn’t buy health insurance. This is true in DFS, too; insurance—in the form of high-floor players who make sense in 50/50s—isn’t as valuable when point-maximization is the goal.