I did a guest post at PokerNews that explained some of the reasons poker players should be naturally good daily fantasy players. Here’s an excerpt:
Perhaps the biggest recent strides in advanced poker strategy have come in the area of game theory. There are all kinds of game theory elements involved in daily fantasy sports, too, particularly in the massive tournaments with a lot of users. In this weekend’s Millionaire Maker on DraftKings, for example, there’s a very good chance that the winner is going to hit on an obscure player that isn’t in a lot of other lineups.
Those usage rates are extremely important in daily fantasy sports. Basically, there are two types of value. The first is strict dollar-per-point value: how many dollars you need to spend (you must work within the confines of a salary cap) for each point you can be projected to score. All else equal, you want to secure as much value as possible.
But “all else” isn’t always equal. Imagine you enter a tournament and there’s such an obvious value that every single user has him in their lineup. It wouldn’t matter if that player scored zero points or 100 points because it would affect everyone in the same way. Thus, that player would have none of the second type of value: usable value.
To acquire the most usable value, you need to balance pure dollar-per-point value with expected usage. The latter task obviously invokes elements of game theory. In tournaments, you should be trying to balance value with ownership; you want the best players, but you also want to create a unique lineup.
Creating a unique lineup is very much akin to leaving yourself ‘outs’ in poker. You give yourself ways to bounce back if things don’t go as expected. If you’re in 50th place with one player left to play, who would you rather have: the top value who is in 25 lineups that are ahead of you, or a little bit worse value who isn’t in any other lineups? The highest you can finish in the first scenario is 26th. In the latter, it’s first.
PROCESS OVER RESULTS
I can’t tell you how many times I’ve heard someone say something to the tune of “I’m not starting Player X this week. I started him last week and he was horrible!”
Poker players have a natural understanding of “good process.” That’s something that you quickly develop after a few bad beats. Poker players understand that the game is governed by probabilities, and you can make smart moves that don’t work out in the same way that you can play really stupidly and have the chips fall your way.
In the end, those who play the percentages are rewarded. It’s the same way in daily fantasy sports. Like a single hand of poker, there can be a lot of short-term variance, but after awhile, the variance dissipates and the true winners are left standing.