DFS: The Profits and Perils of Stacks and Loss Leaders

Photo: Tim Heitman, USA Today Sports

Is it better to be lucky or to be good? When it comes to large tournaments in the land of DFS, I maintain that you’ll need to be both.

However defined, however gratified, however simplified, luck is the dark matter of fantasy football. It’s the invisible force that is all too easy to run into. When we build lineups we often walk the narrow line of risk and reward. Risk taking, by nature, lays us at the mercy of luck. The only question is can we put it in our favor? The old saying goes “luck favors the prepared”. For our purposes, luck favors the courageous.

Loss Leaders, Exposure and the Thursday Night Fade

Regardless of the format you play, gaining an edge by any means necessary is the difference between profit and loss. For big tournaments we try to isolate value while fading popular plays. In head-to-head matchups we‘re a little bit less aggressive in the name of equality but still need to identity value where others aren’t.

It goes without saying that in GPPs we need to make our lineups as unique as possible. But ignoring massive value because it will be a popular play is a bad strategy. We need to know when to use said play as a loss leader.

The concept of loss leaders is simple: a vendor sells a product at a less than profitable price in exchange for exposure. When the customer comes into the store seeking a discount they are tempted to buy other things. The vendor hopes that selling a product under market value will bring in both volume and visibility.

We can apply this to daily fantasy football when buying players that offer a ton of value, but because of their value, have a high percentage of ownership. In large tournaments, where being a contrarian is so important, we still need to protect our lineups. So even though Jimmy Graham, as an example, is going to be in 80% of lineups Week 1, we use him as a loss leader in our lineups. Meaning, we know that because of his high exposure he offers little value—everyone is making the same play so we equal out regardless of outcome.

The goal is to identify players that will be in a lot of lineups and use our best judgment to know when to fade those players and when to play them.  This applies to big tournaments more so than head-to-head but it’s a strategy that should be considered in every format.

For this reason you should enter in at least one lineup that includes the Thursday night game. By doing so you get an early look at ownership percentages, at least on some sites, when lineups lock Thursday night. The percentages will change by the time Sunday rolls around but we get an idea of which players are being heavily exposed. We can use that as a guide when we set our Sunday lineups.

And since we’re playing in the Thursday game we need to determine whether or not to use the players playing in the Thursday game. It’s common knowledge that the early contest doesn’t favor fantasy football.

David Dodds alluded to this in his blog last year.  And Jonathan Bales nailed the point home in his book “Fantasy Football and Baseball for Smart People – How to Turn Your Hobby into a Fortune”, which I recommend regardless of your experience in the world of DFS.

 In it Bales says this of Thursday games:

“…people love to see their players on television, so they’ll frequently add players from games that are on national TV, perhaps even if it’s not the right move. When you join a Thursday night football GPP, for example, you’ll run into dozens of lineups that are stacked with players from that night’s game just because people want to watch their players”.

He continues: “Overall, there’s right around 10 percent less total fantasy production in Thursday night games as compared to all others”.

The evidence suggests that we should play in contests that include the Thursday night game but fade the players involved. By doing so we eliminate the risk associated with a game that has a history of being bad for fantasy football (and real football for that matter), while also gaining an advantage over players that rush out lineups so they’ll have something to cheer for.

Stacking For Profit

It’s common practice to stack players from the same team when the matchup is favorable. Most notably, pairing a quarterback and his No. 1 wide receiver offers huge upside in the event that these two players live up to, or hopefully surpass, expectations.

But knowing when to stack and when not to stack is just as important as who you stack. To assist us in making these decisions we’ll use the point spreads and over/under set by Vegas. Identifying high scoring matchups and stacking the players involved is a great strategy that we will discuss every week in this space.

I’ll use the same example here that I used earlier this summer when we took an early trip to the bargain bin. According to Vegas the Broncos and the Colts are in for a barn-burner and we want to get as many players from this game as we can. The first combination that should come to everyone’s mind is Peyton Manning and Demaryius Thomas.

But there are two problems with this stack. The first is that it swallows 31.5 percent of our cap. Considering that in a GPP our goal is to score 180 points, their price tag means we’ll need these two players to combine for at least 55 points.

The second is that Manning/Thomas will be a popular play and therefore a loss leader—an expensive one at that. I would suspect their ownership percentages to be well over the 50 percent margin and possibly in the high 70s. So the question we have to ask ourselves is if they’re worth the cost.

For the answer, we turn to history.

In the table below I’ve calculated the average combined fantasy points for popular stacks in 2013. I identified 12 combinations that were successful last year and should be popular this year. I chose these players based on the top scoring wide receivers that also have high ADPs entering 2014. I eliminated players that are no longer on the same team. So Eric Decker, even though he finished as the ninth best wide receiver, isn’t on this list. Neither is Andre Johnson since he has a new quarterback throwing to him.

I’ve sorted this group by the highest scoring average based on a full one point PPR. I also included the number times they had at least 50 points in a game and the number of times they had at least 45.

A couple of things to note is that due to sample size, the Rodgers stacks and Cutler stacks are slightly skewed. The same goes for Brady/Gronkowski. These players missed significant time, which isn’t reflected in their averages. But it gives us an idea of what they’re capable of.

It goes without saying that Manning and his offense put together a historical 2013 that will likely not be repeated. The key word in that sentence is “likely”. Manning threw 55 touchdowns, 18 more than he did in 2012 and topped his career high of 49 set back in 2004. Our projections credit him with 41 for 2014. That’s still a lot of points, but we need to temper our expectations to the mean. Regression will be in full force this fall.

All of that said, Manning and his receivers should make for great stacks all season long. It’s no surprise that Demaryius Thomas and Julius Thomas are at the top of this list. In fact, you could make an argument that starting all three in a GPP is a fine way to score about 75 points between three positions. But like with all stacks, we need to be aware of the risk involved. Even the almighty Broncos offense can stutter. We saw proof of that in Week 15 last year (and more proof to avoid Thursday night games).

Speaking of risk, a point of interest is the average of Tony Romo and Dez Bryant. That was not a successful stack last year. They gave us only one game of 50+ points and that was in Week 5 when they combined for 72 against the Broncos. I know a lot of people are banking on how horrible the Cowboys defense looks to start the season. But let’s not forget that they were historically bad last year, and that Romo and company were playing from behind often. In Week 1 they’re going to cost us 28 percent of our cap. As tempting as these players are, I’m more tempted to fade them in the early part of the season.

Drew Brees and Jimmy Graham clocked in as the third highest scoring combination. That’s what 16 touchdowns will do for you. This tells us that we should favor QB/TE stacks more than QB/WR. When Gronkowski is healthy he and Brady are a lethal combination. We got some good news from the Twitter machine regarding this:

Rob Gronkowski is playing Week 1 for the Patriots.

— Doug Kyed (@DougKyedNESN) September 1, 2014

A healthy Gronkowski gives us three solid QB/TE options for Week 1 and I recommend grabbing at least one of them. Brees/Graham have the most favorable matchup but cost slightly more than Manning/J. Thomas on FanDuel. Brady/Gronkowski check in as the most expensive QB/TE stack and therefore I can’t advise them. We don’t know how much Gronkowski will play and I’m not confident that Brady is going to provide us with enough points to justify his salary. Manning and Brees are much safer plays, though overly exposed.

Of course, it wouldn’t be fair to just look at weekly averages and not offer the bigger picture. In the next table I sorted these 12 combinations by the highest scoring weeks in PPR.

It comes as no surprise that Manning and the pair of Thomas are heavily represented in the top half. In fact, the average week for all combinations was 39.3 points. Manning and D. Thomas had 11 weeks above that, and J. Thomas had seven.

It’s only fair to note how much the Manning offense raised the average. If you were to remove all Broncos players from the above chart the average drops to 37.9. That’s a significant amount. Still, a score of 38 is a fine median to hang our hat on.

But the most interesting thing about this chart is what it tells us about Calvin Johnson and Matthew Stafford. You see them clustered at the bottom with four of the lowest scoring weeks. So even though they had seven above average weeks, they also tanked our lineups more than half of the time. The moral of the story is that owning Johnson is great but pairing him with Stafford is not.

The same story can be told about Ben Roethlisberger and Antonio Brown. Brown was a PPR monster last season. But they combined for only five games above the 39.3 average. The only benefit is Roethlisberger’s price, which is thousands less than your top tier quarterbacks. But if you’re looking to take a discount on a QB you should avoid the middle tier altogether and just head straight for the basement.

Andy Dalton and A.J. Green managed eight above average weeks. But when they were bad they were really bad. They had four weeks where they combined for fewer than 27 points. That’s not going to get it done in any contest. Dalton, like Roethlisberger, is priced accordingly so you get a discount on a QB with a stud wide receiver. But the risk of stacking them isn’t worth the propensity for failure. And under no circumstances should you start Dalton and not start Green.

Summation

• Target quarterback/tight end combinations where possible. The top tight ends will always cost less than the top receivers and there’s evidence that QB/TE is a better play.
• Play the Thursday night game but don’t play the Thursday night game. It’s good to get an early feel for the crowd but fading the players in the Thursday game is recommended most of the time.
• Loss leaders are your friend. We can’t afford to ignore value in the name of contrarianism. When the price and play are right fading them to be different is a losing strategy.
• Be creative and courageous with your lineups in big tournaments. This is the only way to put luck in your favor.
• When stacking players we need a 40-point return, regardless of salary. We can use Vegas to navigate us towards the teams that offer the best odds for a game changing combination. 

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