We now know how to calculate variance of fantasy performances of a given player, but now you’re probably thinking: why is this important? You are asking the right questions. It is a good one. It all goes back to the differences between the payout structure and the number of lineups entered in the two types of contests.
Payout structure differences have a more significant impact, so let us start with that.
Impact of Payout Structure on Desired Variance
As a reminder, there are 2 main differences between the payout structure of a Tournament and a 50/50 contest.
Percentage of lineups entered that win
- In a paid 50/50 contest, half of all entries win money giving an entry a 50% chance to win.
- On the other hand, roughly 25% of all lineups entered in a Tournament end up winning.
Payout received for winning
- In a paid 50/50 contest, all winning entries win the same amount of money. Whether you are in 1st place or 50th place out of 100 entries, you receive the same payout. As a result, if you can consistently be slightly better than the median lineup, you would have a profitable strategy for 50/50 contests.
- Tournament contests have a very top-heavy payout structure. As a result, you can still have a profitable strategy even if you win a lot less often than you would need to in a 50/50 contest. In fact, the lineup that ends in 1st place can receive 300-500 times their entry fee. This means that if you can manage to create a better lineup than everyone else in the contest, you may be able to enter 299 losing lineups and still break even.
The significance of these differences can be summarized quite simply.
If you are entering Tournaments, you want players in your lineup with high variance in fantasy points scored per game. This would give you a higher chance of finishing in the top-heavy winning portion of entries. It will also make you more likely to finish at the bottom, but since you win $0.00 for finishing above 70% of lineups or for finishing in last place, that won’t make much difference.
However, if you want to enter 50/50 contests, you should select players with low variance that give you high chance of doing just a little bit better than half of the other entries.
In other words, if you want to enter Tournaments, the “boom or bust” strategy is likely going to work better for you in the long run. Keep in mind though that this approach requires a large sample size created by entering many Tournaments. Even if we know we have a profitable system, since a 1st place finish may require hundreds of entries before it actually hits. If this is the approach you want to take, you should choose an entry fee you can afford to pay 1000 times, not one that you can afford to pay once.
You would effectively be playing the lottery at that point. That is not my goal with these posts. Plan to achieve a large sample size when using math to create a profitable betting system. Again, nothing in these posts should be thought of as fanatical or gambling advise. However, if you want to implement any of the strategies discussed, it’s important to test their statistical significance.
If you want to play along and enter some FanDuel lineups of your own as we conduct this investigation, you can use my FanDuel referral link here to get a deposit bonus. You should just need to deposit at least $15 within 30 days of signing up, and you’ll get a $15 bonus added to your account if you use that link.
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