Who doesn’t like getting something for nothing? That’s one of life’s great joys.
Did you know that you can enjoy the theory of ‘something for nothing’ in your DFS gaming too?
That’s right: this is called an overlay, and it’s one of the most exciting scenarios available in Daily Fantasy.
You will notice that every week, a number of DFS sites create guaranteed prize-pool contests across football, soccer, golf, etc.
So, that means that a guaranteed amount of money is paid out to entrants finishing in the required positions; it could be top 10, it could be top 2,000 depending on the contest size.
If a contest has a guarantee prize pool of $1,000,000, and the buy-in fee is $100 per player, then the Daily Fantasy site needs 10,000 entries to cover their liability.
If the entry list is below 10,000, then this is called an overlay. In this scenario the site, whether it’s DraftKings, FanDuel, or any other, will have to dip into their own coffers to cover the shortfall.
Think about it: if the required number of entries isn’t filled, then your chances of landing a big prize just got better; that’s basic maths.
A great example of an overlay happened back in 2013, when DraftKings was looking to kickstart the NFL season with a bang. They offered a contest which features a prize-pool of $1,000,000 and a top prize of $150,000, with buy-in set at $200.
At this point, Daily Fantasy Sports hadn’t really kicked off in popularity, and so in a contest needing 5,000 entries to break even, DraftKings must have been horrified to see that only 2,800 teams had been submitted.
For players, that meant their chances of winning the top prize was halved from 1 in 5,000 to 1 in 2,800 – and that’s assuming they entered only one roster.
The DFS platforms are a lot smarter these days in preventing these scenarios from happening, but overlays are still available each and every week.
As shown by the reasons outlined above, overlays are great for two main reasons:
It is only natural that some contests fill up at the last possible minute; some drafters wait for team news before submitting their rosters.
But smart DFS managers can spot an overlay a mile off – and it’s not difficult to do, just look at the entry numbers!
Most of the bigger sites like DraftKings and FanDuel pay out prizes to around 20-25% of the field. In overlay situations, the reality is that this can increase up to 30-40%….and that’s good news for you, friend.
Be careful of going in too deep when spotting overlay opportunities; there are thousands of other canny folks out there just like you.
But if you do spot an overlay and the clock is ticking for entries, be sure to get involved.
Calculating how good the overlay is requires some simple maths. So let’s say that the guaranteed prize contest offers a kitty of £100,000 and there are supposed to be 1,000 entrants; that means that each team has a value of $100.
What happens if only 750 rosters are entered? Clearly, the value of your draft increases to $133.33 ($100,000/750). So already your investment has increased by 33% before a ball has been kicked or hit!
Overlays basically increase the value of your dollar: a $100 buy-in can increase in value quite substantially before any action has even taken place.
There are two ways to look at this: firstly, the key sites offer bigger prize pools that require more entrants to cover the cost. For niche sports, like European Tour golf, Mexican soccer, or NASCAR, clearly the demand for these contests is less than for the PGA Tour and the English Premier League.
It is in these little cracks that overlays at DraftKings and FanDuel can be found.
Smaller, less established DFS sites offer overlays too; think about it, they simply don’t have the numbers of ‘customers’ to fill their entry requirements.
Hopefully this guide has been helpful to you, and all that is left to say is happy overlaying!
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