100 Fantasy Football Tips in 100 Days, Day 2: Warren Buffett and Fantasy Football
Today’s fantasy football lesson again comes courtesy of my fantasy football training school RotoAcademy, where I related Warren Buffett’s investment tips to fantasy football:
1. You don’t need to be an expert in order to achieve satisfactory investment returns. But if you aren’t, you must recognize your limitations and follow a course certain to work reasonably well. Keep things simple and don’t swing for the fences. When promised quick profits, respond with a quick “no.”
I think one of the most difficult things to do in fantasy football is realize when you should be okay with assuming some risk and when you should play it safe. This quote is most applicable in the early rounds of fantasy drafts. When the cost is high, you should play it safe. This is actually one of the reasons that, although I don’t necessarily advocate a true early-quarterback approach, I’m okay with taking an elite passer in the third or fourth round. It’s simple. It’s safe. When others are swinging for the fences early in drafts, take the double.
2. Focus on the future productivity of the asset you are considering. If you don’t feel comfortable making a rough estimate of the asset’s future earnings, just forget it and move on. No one has the ability to evaluate every investment possibility. But omniscience isn’t necessary; you only need to understand the actions you undertake.
The value of any player—the asset—is his future “earnings” minus his cost. This quote–particularly the idea that you should avoid assets whose future earnings are basically unknowable–is related to the first point. Sometimes, fantasy owners want to so badly hit a home run with their first couple picks that they’re willing to take on the unknown.
There’s a difference between known and unknown risks. I’m not at all against assuming uncertainty later in drafts, but if you have a pretty clear idea of a player’s upside but little understanding of the potential risks, you should pay as little as possible. Take your shots on uncertainty when the cost of missing is minimal.
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