Daily Fantasy Sports Research Articles

Decision support system for policy-making: Quantifying skill and chance in daily fantasy sports

We explore the question of skill versus chance dominance in Daily Fantasy Sports (DFS), which has been the subject of numerous legal disputes around the world. Our study examines whether a contestant's winnability in DFS is influenced by factors reflecting skills using cricket-based daily fantasy contest data and a true fixed effects stochastic frontier model. We find that skill contributes significantly towards winnability in five ways. First, contestants performing well in the past do better in the present. Second, gaining more game experiences improves performance. Third, contestants who participated recently, tend to exhibit higher winnability. Fourth, selecting an appropriate contest type enhances winnability. Fifth, the large estimated signal-to-noise ratio indicates that the unobserved skill measured by a non-negative error has a much greater impact on winnability than the regular two-sided random shocks. These results are robust to varying specifications and subsets of data. Decision makers and regulators can use the model presented in the study to distinguish skill-dominant DFS from chance-dominant DFS.

An innovative method for accurate NBA player performance forecasting and line-up optimization in daily fantasy sports

AbstractThis study presents a novel approach for predicting NBA players' performance in Fantasy Points (FP) by developing individualized models for 203 players, using advanced basketball metrics from season 2011–2012 up to season 2020–2021 from reliable sources. A two-step evaluation and validation process secured validity, while applying linear optimization methodology, considering constraints such as salary and player position to recommend an eight-player line-up for Daily Fantasy Sports (DFS). Four scenarios with 14 machine learning models and meta-models with a blending approach with an ensembling methodology were evaluated. Using individual per-player modeling, standard and advanced features, and different timespans resulted in accurate, well-established, and well-generalized predictions. Standard features improved MAPE results by 1.7–1.9% in the evaluation and 0.2–2.1% in the validation set. Additionally, two model selection cases were developed, with average scoring MAPEs of 28.90% and 29.50% and MAEs of 7.33 and 7.74 for validation sets. The most effective models included Voting Meta-Model, Random Forest, Bayesian Ridge, AdaBoost, and Elastic Net. The research demonstrated practical application using predictions in a real-life DFS case evaluated in a DFS tournament on a specific match day. Among 11,764 real users, our Daily Line-up Optimizer ranked in the top 18.4%, and profitable line-ups reached the top 23.5%. This unique approach proves the proposed methodology's effectiveness and emphasizes its profitability, as the optimizer process delivers positive results.

Does Smart Money Believe in the Hot Hand? Evidence From Daily Fantasy Baseball

The behavior of informed traders, or “smart money,” in sports betting markets has long been of interest to researchers. In this paper, we focus specifically on the behavior of smart money in Major League Baseball (MLB) daily fantasy sports (DFS) contests to determine whether they avoid cognitive-behavioral biases to increase their expected earnings. Specifically, we investigate whether smart money avoids the hot hand bias, where individuals tend to overestimate the likelihood of success for players on a hot streak. Using a dataset of MLB DFS contests, we find that winning lineups have lower usage rates for players exhibiting the hot hand compared to losing lineups. This suggests that smart money identifies and fades the hot hand strategy to increase their expected earnings.

Competing in daily fantasy sports using generative models

AbstractWe introduce a model for competing in daily fantasy sports competitions. Our approach combines modeling of players' fantasy points and subsequent lineup optimization. The distribution of fantasy points was estimated using an ensemble of generative models. We designed a mixed‐integer quadratic program to optimize not only the average fantasy points but also the variance and covariance of players' fantasy points to exploit the top‐heavy payout structures. We tested our approach on real‐world data. Over eight weeks, the model generated a profit of €2439 with an initial investment of €7133, resulting in a return on investment of over 34%.

Removing Chance From the Litigation of Daily Fantasy Sports: The Need to Broaden the Scope of What Constitutes a Game of Skill

Removing Chance From the Litigation of Daily Fantasy Sports: The Need to Broaden the Scope of What Constitutes a Game of Skill

New Day, New Game: Examining Consumer Needs in Daily Fantasy Sports

Abstract: The aim of the current research was to identify consumer needs that significantly influenced daily fantasy sports (DFS) consumption. Specifically, we sought to predict DFS participation intention and information search. Existence, relatedness, and growth (ERG) theory and self-determination theory (SDT) served as theoretical inspirations for need selection. The needs included were needs for autonomy, arousal, uniqueness, status, achievement, competence, and relatedness. The results of the current study indicate that autonomy and achievement needs are important for DFS consumers. Additionally, highly involved DFS participants are more likely to be driven by needs competence, while low involvement players showed relatively higher level of needs for arousal and uniqueness drove their DFS participation intention. These results from our model can be used by industry professionals in the DFS space to better understand the consumer needs and develop effective market strategies within daily fantasy sports.

Time out: Prediction of self-exclusion from daily fantasy sports.

Responsible gambling (RG) tools that include play management software, self-limit features, and self-exclusion are relatively common offerings on major online gambling platforms. However, how online gaming and daily fantasy sports (DFS) players use such tools is less clear. The goals of this article were to understand how players use self-exclusion at a major DFS platform and to identify DFS activity-related predictors of self-exclusion. During November 2015, DraftKings, a major DFS provider, rolled out a self-exclusion feature that allows players to self-exclude from the platform for a specified amount of time, up to 5 years. We used player records from DraftKings, examining play patterns and self-exclusion across 3 + years of data. We found that less than 0.5% of subscribers in our sample self-excluded during the study period and almost one third of those who self-excluded did so more than once. In general, self-excluders engaged with a greater variety of contests and sports and entered contests with higher entry fees than those who did not self-exclude. Repeat self-excluders selected shorter initial self-exclusion terms and also engaged with a greater variety of game types and sports than one-time self-excluders. However, self-excluders did not engage in riskier contests or experience higher percent losses. Our findings have implications for our understanding of RG feature use among DFS subscribers and markers of risk for experiencing problems with DFS and gambling more generally. (PsycInfo Database Record (c) 2022 APA, all rights reserved).

Correction to: Daily fantasy sports and the law in the USA

Correction to: Daily fantasy sports and the law in the USA

Supplemental Material for Time Out: Prediction of Self-Exclusion From Daily Fantasy Sports

Supplemental Material for Time Out: Prediction of Self-Exclusion From Daily Fantasy Sports

A large-scale prospective study of big wins and their relationship with future financial and time involvement in actual daily fantasy sports contests.

Early big wins might have a psychological impact upon gamblers that increases their likelihood of intemperate gambling; however, there has been a paucity of empirical research examining this effect using actual gambling data. We assessed the effects of daily fantasy sports (DFS) big wins on subsequent play by analyzing a prospective dataset from a major DFS provider (N = 34,596 DFS subscribers) representing over 18 million entries into DFS contests. We found that experiencing a big win in DFS is associated with subsequently increased DFS engagement (i.e., increased contest entry fees and contest entries) and losses (i.e., higher net loss). However, the effect of a big win on engagement and losses decays over time. Whereas theorists have highlighted the effects of early big wins, our analyses indicated that later big wins had a relatively stronger effect on DFS engagement. Sensitivity analyses confirmed the robustness of most results, with somewhat greater support for big wins' effects on engagement metrics than losses. Our results collectively indicate the existence of a big win effect in DFS. For some players, big wins might instill unrealistic expectations about future probabilities of winning and lead to increased-and potentially excessive-engagement. Explanations from cognitive psychology (e.g., the illusion of control) and behavioral psychology (e.g., operant conditioning) might help to explain the big win effect. (PsycInfo Database Record (c) 2021 APA, all rights reserved).

Player Pricing Mechanisms and the Daily Fantasy Sport Chance Versus Skill Debate

Abstract: Differentiating and defining games of skill versus chance have major legal implications when classifying gambling, especially in relation to daily fantasy sports in the United States. This paper provides a theoretical discussion and introduces an empirical approach to analyzing game player pricing mechanisms. If game pricing mechanisms are fully efficient—player prices fully reflect the expected contributions from players—then that game is one of chance since there is no opportunity for skill to play a role in outcomes. This paper examines player prices from DraftKings’ daily fantasy football product. Empirical results show that there are strategies deriving from the pricing mechanism that can be incorporated by skilled participants to increase their expected performance and improve their chances of winning. This provides evidence that daily fantasy sports are skill-based—a necessary condition for skill to be a predominant factor in game outcomes as part of the legal debate.

Daily fantasy sports and the law in the USA

This chapter examines legal, regulatory, and social issues surrounding the phenomenon of the daily fantasy sports (DFS) industry in the USA. Traditional fantasy sports contests largely involved groups of family or friends creating their own respective “fantasy” teams of real professional athletes, whose actual games results over the course of an entire season determined the success of one’s fantasy team. Fantasy sports contests were not considered gambling on sports, and federal legislation exempts “fantasy sports” from prohibitions against online gambling. As the name implied, DFS is a different product, offering users who pay the DFS operating company to select their team roster on a daily basis, competitions can occur over a day or a week depending on the contest, and among thousands of users, few of whom are consistent winners in the contests. The DFS commercials and advertisements are again blaring the airwaves. Major DFS operators are expanding their product lines and are now fully immersed in online, mobile, and casino sports gambling in states where legal. The DFS and sports gaming market is booming; the technology, analytics, user sophistication, financial stakes, and the distinction between DFS and gambling are increasingly blurred. This chapter considers the legal, regulatory, and social issues arising from the expanding DFS and sport gaming business.

The History and Evolution of the Fantasy Sport Voice: An Oral Account of the Major Aspects Forming the Fantasy Sports and Gaming Association

The growth of the fantasy sport industry has been nothing short of extraordinary. With estimates of 500,000 in the mid-1990s, to a current North American consumer estimate of 59.3 million, the industry has evolved quickly and with quite a force. Historical roots date fantasy activity back to the 1950s and 1960s. Since then, this industry has seen many phases of growth, expansion, trials, and tribulations. For many years, the Fantasy Sports Trade Association (FSTA) has served as ‘the voice’ for the industry in many matters, as its members and professional associations strived for legitimacy, legality, and longevity in creating professional careers. The FSTA has invited major (and minor) players to join as one association and attend semi-annual conferences to collaborate, learn, share, and grow the industry as a whole. Fighting off player strikes, gambling law, and incredible growth of daily fantasy sport operation, this organization has guided industry professionals throughout. This article provides an historical account of the formation of the organization responsible for holding this flourishing industry together and growing as one. Data were gathered from oral accounts of key events in the life of this organization.

‘Functionally Equivalent’: How Daily Fantasy Sport Ended American Legal Debates on Sports Gambling

The United States has a complex history of gambling. Modern sport, fantasy sport, and daily fantasy sport (DFS) has complicated legal and moral views on gambling. Modern sport provided a means for widespread gambling; fantasy sport grew in the midst of legislation banning gambling; and DFS rode the coattails of a legal exemption for fantasy sport. DFS provided a bridge between fantasy sport and sports gambling, showing the untenable logic of laws accepting the former while prohibiting the latter, resulting in the trivialization and retraction of federal laws prohibiting sports gambling.

Productive play: The shift from responsible consumption to responsible production

Regulatory approaches to games are organized by boundaries between game/not-game, game/gambling game, skilled/unskilled play, consumption/production. Perhaps more importantly, moral justifications for regulating gambling (and condemning digital games) are rooted in the idea that they consume our time and wages but give little in return. This article uses two case studies to show how these boundaries and justifications are now perforated and reconfigured by digital mediation. The case study of Daily Fantasy Sports (DFS) illustrates a contemporary challenge to rigid dichotomies between game/not game, skilled/unskilled play, and game/gambling game, demonstrating how regulation becomes deterritorialized as gambling moves out of state-regulated physical casinos and takes the form of networked, digital games. Our second case study of Pokémon Go approaches regulation from a different direction, complicating the rigid dichotomy between production/consumption in online networked play. We show how play is increasingly realized as productive in economic, social, physical, subjective and analytic registers, while at the same time, it is driven by gambling design imperatives, such as extending time-on-device. Pokémon Go exemplifies analytic productivity, a term we use to refer to the production of data flows that can be leveraged for a wide variety of purposes, including to predict, shape, and channel the behaviour of player populations, thereby generating multiple streams of revenue. Ultimately, both cases illustrate how digital games and gambling increasingly blur into each other, complicating the regulatory landscape.

Supplemental Material for A Large-Scale Prospective Study of Big Wins and Their Relationship with Future Financial and Time Involvement in Actual Daily Fantasy Sports Contests

Supplemental Material for A Large-Scale Prospective Study of Big Wins and Their Relationship with Future Financial and Time Involvement in Actual Daily Fantasy Sports Contests

Market Efficiency and the Setting of Salaries for NBA Daily Fantasy on FanDuel and Draft Kings

The market for daily fantasy sports for the NBA is examined with respect to efficiency when pricing player salaries for the games. Simple factors such as home court advantage, rest, and opponent are shown to significantly effect performance beyond posted salaries in the respective markets. In addition, a “hot hand” effect is found in that players that exceed expectations in previous games are shown to outperform salary-based expectations in the next contest. These factors yield a rejection of market efficiency as it relates to salaries in the marketplace. Legal ramifications for these contests as games of skill are examined.

Optimising Daily Fantasy Sports Teams with Artificial Intelligence

Abstract This paper outlines a novel approach to optimising teams for Daily Fantasy Sports (DFS) contests. To this end, we propose a number of new models and algorithms to solve the team formation problems posed by DFS. Specifically, we focus on the National Football League (NFL) and predict the performance of real-world players to form the optimal fantasy team using mixed-integer programming. We test our solutions using real-world data-sets from across four seasons (2014-2017). We highlight the advantage that can be gained from using our machine-based methods and show that our solutions outperform existing benchmarks, turning a profit in up to 81.3% of DFS game-weeks over a season.

A Swiftly Changing Tide: Fantasy Sport, Gambling, and Alternative Forms of Participation

The fantasy sport industry has seen tremendous changes in the past five years, thanks in large part to increased participation, media acceptance, easing of legal pressure, and the proliferation of daily fantasy sport. Similarly, sports gambling recently moved further into the spotlight with a 2018 U.S. Supreme Court ruling striking down a 1992 law allowing Nevada to be the only state to legally house sports betting. Having once been advised to steer clear of each other, gambling and fantasy sport interests are now becoming increasingly intertwined. Utilizing quantitative data from a national survey of 519 fantasy sport participants, this study explores attitudes of and participation in alternative forms of fantasy sport and sports betting. Insights can be gleaned regarding familiarity in the activities, reluctance in participation, sport consumption, future participation, and connection points between fantasy sport and sports gambling cultures.

An examination of consumer reactance to daily fantasy sport and sport gambling regulatory restrictions

According to psychological reactance theory (PRT), when an individual’s freedom is threatened or eliminated, a state of reactance will occur in an attempt to have the freedom restored. Consumer reactance to firm marketing strategies and governmental restrictions have been examined in a variety of contexts. However, an examination of consumer reactance regarding participation in sport gaming activities, such as daily fantasy sport and sport gambling is non-existent. Two studies were developed using experimental designs to: (a) identify whether sport gaming participation intentions were influenced by government restrictions; (b) examine the influence of reactance tendencies on behavioral intentions; and (c) test whether consumer reactance moderates the relationship between government restrictions and gaming intentions. Our results showed significant differences in intentions based on government restrictions for both daily fantasy sport (DFS) and sport gambling participants. Mean intention scores were highest in the scenarios where the activities were legal, which is contrary to previous consumer reactance literature. However, varying state regulations may be playing a role, as individuals can participate in these activities in states where they are legal. Additionally, consumer reactance played a moderating role for groups that were discouraged or restricted from the activity. Consumers with high reactance tendencies reacted unfavorably to threats of freedom as anticipated, extending our knowledge of the impacts of consumer reactance within the sport gaming industry.