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Advanced NBA DFS: Bankroll Allocation

We continue our breakdown of the basics for NBA DFS. In this section, we look at bankroll allocation, with definitions and some basic strategy.

LA Clippers owner Steve Ballmer reacts after the game against the Los Angeles Lakers at Staples Center. The Clippers defeated the Lakers 112-102. Kirby Lee-USA TODAY Sports

In daily fantasy basketball, like in most things, getting the fundamentals down is integral toward laying a foundation of knowledge to build from as you progress as a player. For DFS, that means understanding statistics and which ones will help you most in building your lineups. One of those is Bankroll Allocation, which we will discuss below.

Bankroll Allocation

Definition

Bankroll Allocation is how you distribute your bankroll throughout the contests you are entering. So its basically how you want to enter/use your money in your DraftKings account. This doesn’t mean your bankroll is all the money in your DraftKings account, however. Bankroll allocating is important because it gives us a rough idea of how much we can lose on a certain contest or win. Good bankroll allocation is key for most pro players.

Strategy

Cash games

This really depends on the type of player you are. If you’re a cash-game player, chances are you’re going to be playing fewer lineups and more contest volume. If you’re playing in everything — 50/50s, Double-Ups, H2Hs — then you’re going to want to allocate the bankroll according to how confident you feel in your lineup. I like to use examples throughout this process because it’s a good way of visualizing what we need to do.

Let’s say we have a bankroll of $200 and we want to use $100 of that bankroll on any given night. It’s generally a good rule of thumb once you build a bankroll to not use more than say 55-60% of it on a given night. So here, we’re using half. So we’ve got $100 to enter in contests and we are feeling pretty good about out lineup. If that’s the case, head-to-heads are where we want to go.

So allocating half of the $100 to H2H contests seems like a wise choice. After that, we split up the rest of the lineups with the $50 we have remaining. This can be used to enter 10 times into a $5 Double-Up or just throw all $50 on the one lineup in a 50/50. From here, it’s more contest preference than anything.

GPPs

Tournament bankroll allocation is a little bit more tricky to say the least. it’s not going to be as cut-and-dry as entering cash games because there are more options for us and more ways to invest our money wisely. High-pop GPPs usually carry a ton of variance, both in the field and how the contest is structure. A lot of the times allocating funds for GPPs can be really easy, it can also be pretty taxing.

This is where a lineup builder comes in handy. If we’re going to be entering some high-pop or low-ball GPPs, then we’re going to want to make a handful of lineups with a wide range of exposure. After we do that, we can start to look at how we want to allocating the lineups out. I like to use a pyramid type of structure to bankroll allocation.

Let’s say we’ve got the same bankroll as cash games: $100. We have 20 lineups we made with different exposures. We want to spread things around so that we have the best chance of making up ground. We start by entering the 20 lineups into a low-ball GPP — $1 or $2 entry — these contests usually have a high amount of entries or low. Try and find one with a decent field and good payout — remember these lineups are built for tournaments, all upside. We can mix in a cash lineup or two, but that won’t get us too far in a tournament.

If $20-30 is allocated for low-ball GPPs, then we can look at some contests that minimize risk. Single-entry is good for this. It’s sort of like a hybrid contest in that, the payout is like a tournament but the strategy is all cash. One entry means ownership on certain players will be higher, it isn’t as spread out. Let’s get our best lineup, the golden gem of the bunch and throw it into a single-entry. The other half, if you’re feeling frisky, can be hedged from the single-entry with a more risky lineup. If we enter a $36 or $55 GPP, there are fewer entries, so while we’re risking more cash, the reward is higher and sometimes easier to attain.

Final Thoughts

If you’ve been around the block a bit you probably know how to allocate your bankroll. If you haven’t thought about it, maybe it’s time to start budgeting. DFS is supposed to be fun and winning is a big part of that. The better we manage our bankroll, the more fun that can be had. I sound like a Little League baseball coach, but it’s the truth. That’s why athletes get into it to start out and that’s what draws DFS players in. Don’t get too emotional. Don’t make money decisions with your, well, you know — use your head!