Daily Fantasy Sports a Skill? Not a Chance.

 In Daily Fantasy, Gambling, probabilities, Squares

The Background

Over the past few years, there has been a ton of debate on about the legality of Daily Fantasy Sports (DFS) and whether or not they are a truly a “skill” based game. We at Squares King are firm believers that daily fantasy as well as traditional based fantasy games are nothing more than pure games of chance with lower odds than most table games in Vegas.

The Set Up

The premise and allure of fantasy sports is that you get to play GM of your own franchise. You can pick from the pool of players, within the allotted salary cap and manage your team on a daily or seasonal basis. In DFS, each sport has a prescribed lineup. For instance, in DFS basketball, depending on the site, the typical lineup is PG, PG, SG, SG, SF, SF, PF, PF, C. and, most recently, on one of the sites, the player gets a $60,000 salary cap to use on selecting his players for the night. Each player receives points for rebounds, steals, assists, points and loses points for turnovers. There are a plethora of sites available to sports junkies, like us, that offer value reports, research, and lineup optimizers. Seems simple enough, the “skill” with picking a team is using your bias to filter through the information and then pick the team with the highest probability of scoring the most points. But what’s the real probability of doing that? How come, with all the information available to us, all the pots aren’t chopped?

The Scam

Although there is a huge push to legalize DFS in all 50 states, it still remains illegal, or partially illegal in many. There is a fantastic resource for continuing to check the legality of all the major DFS sites here: http://www.legalsportsreport.com/daily-fantasy-sports-blocked-allowed-states/. So, in this battle of legality, who’s right? It’s our opinion, at Squares King, that the states that see DFS as a game of chance are correct. Although we believe that everyone should be able to play any game they want, we don’t think the ability to harness your bias and willingness to see floor/ceiling and value is necessarily a “skill”. As we sated earlier, all of the information is available to everyone. If everyone is using the same basic algorithms, trying to find the best value for the dollar, many if not all of the pots would be chopped. The simple fact of the matter is sports is a series of random events. They are not predictable. The old saying “that’s why they play the games” is sage. Just as sage, is the old statistical saying that “past results do not equal future performance.” A recent example is this.http://thecomeback.com/ncaa/despite-loss-the-alabama-crimson-tide-had-an-outstanding-season.html. Think about it, if you had used this information to bet everything on Alabama, after the first half of the championship game, you would have lost everything. With all of this being known, it boils don’t to this. Daily and Traditional Fantasy Sports are nothing more than multiple problems of probability without replacement when selecting any team or constructing any lineup and that’s why we think saying this is a” skill” is a scam.

The Math

It’s really simple when you apply the math to these particular problems. The smaller the slate, the better the probabilities of picking the right lineup, with the better being a very sarcastic, better. The truth is even  a when there is a small slate of games, and even without bias, the odds of picking the right lineup are incredibly small.

First let’s look at an example of basic probability without replacement. In this case there are 40 marbles, 10 of which are red. Seems easy enough, you have a 1/4 chance of picking a red marble. But how do the odds change after that first pick? If you miss on the first try, your odds actually get slightly better, you now have a 10/39 chance of picking a red marble. If, by chance, you have the “skill” of selecting a red marble, then your odds on the next pick actually get a little worse, 9/39. and so it goes until you have picked the 10 red marbles. What do red marbles have to do with picking a lineup? EVERYTHING. You, as a DFS player, are trying to pick the “red marbles” every time you select a lineup. Think about it. All that separates a red marble from an other marble is a characteristic, in this case color. You are trying to pick players with a specific characteristic; providing the most fantasy points for your fantasy salary cap dollar. But you task is a lot harder because of resource segregation. In basketball, you have to have a lineup that produces or exceeds the model in predicted value for the total all while selecting two of the highest value point guards, two shooting guards, two power forwards, two small forwards and a center. This doesn’t sound hard and the experts would lead you to believe that their insights will help you improve your probabilities. Here’s a news flash: They don’t; all they help you do is form your bias.

Let’s look at an example:

In the example above, with a three game slate, it would seem simple enough pick the best line ups. But in the table below, you can see that the probabilities are actually really small. and that’s with just a three game slate.

Probabilities

Yeah, you are seeing that correctly. The cumulative probability of picking the “red marble” basket ball players, by position is close to 1 in 100,000,000. if we round up! The actual is 7 in a billion. To this, you may say “Wait a minute..that’s not necessarily fair . Someone always wins, so someone picks the best lineup”. Yep, you’re right, but mostly it’s because their bias was better than yours. The better DFS players are at eliminating choices, the better their odds of picking will be. With your bias, you could pretty easily narrow the list of choices down to 3 or 4 per position, but that’s where the randomness of sports gets you. Your bias, or hunches, can either help or hurt you. Look at all the of the popular sites for Daily Fantasy Sports. There is a ton of information available to help you form your bias. Match up data, injury reports, trends, twitter feeds, your love for the home team, etc. etc. How many people knew that Lesean McCoy was going to be a complete bust the year he was the consensus number one pick in fantasy football? Or that Adrian Petersen would get hurt the first week of the season, or that Clayton Kershaw would be on the DL for a huge portion of the year last year? Again – no one. It was all luck of the draw, and if that’s what it boils down to, than it its not a game of skill, it is a game of chance.

Summary

To us at Squares King, the bottom line is this. If you want to take a chance and have fun playing DFS and fantasy sports, by all means do. We sincerely hope you enjoy the experience. But be smart about it. Realize that it is random, you can help your probabilities by being informed and making good choices with those informed biases. But don’t kid yourself. The probabilities are not good.

If you want to sit back, relax, watch the game and maybe win a square or two. We are your game! Squares King – Where real probabilities rule!

Sources:

Link 1: By Chris Grove, www.thelegalsportsreport.com

Link 2: by on Jan 10, 2017 02:05, www.thecomeback.com

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