Using Price to Points Ratio in Daily Fantasy Analysis
One of the most commonly used methods for analyzing publicly traded stocks is the Price/Earnings Ratio (P/E Ratio) since it is an off the cuff method for an apples to apples comparison of otherwise different stocks. It is defined as the market price per share divided by annual earnings per share, and it allows one to analyze the market's stock valuation of a company and its shares relative to the income the company is actually generating.
We use the Price to Points Ratio in our Daily Fantasy Analysis as a similar method for analyzing daily fantasy football comparisons. To the best of our knowledge we are the first group to publically share in-depth insight on why this method of fantasy analysis must become part of your daily fantasy decision making process. The concept is identical to the idea of a (P/E) ratio being used in stock investing in that it creates apples to apples comparison of players with otherwise different established daily fantasy prices. Thus, an objective approach to the daily fantasy selection process should disregard the daily cost of a player or the projected points of a player in isolation, as ultimately what matters most is how much the overall COST of a player’s points are in comparison to other competing players at the same position.
You can see how simple this method is to use in forming an objective fantasy decision making process. By dividing the (Daily Fantasy Price / by the Players Projected Points) you will be left with a number which will show the relative cost of each players projected points.
It is crucial to 1st determine which daily fantasy site (FanDuel.Com Vrs. DraftKings.Com) you are using as different websites ultimately have differing values and rankings, which ultimatley becomes even more fundamental to exploiting discrepancies and finding “Arbitrage Players”.
Secondly, you must determine which source of players’ projected weekly points is being derived from. In the cases identified below we used www.profootballfocus.com for our source of a players projected points and have also used Yahoo player projections in the past. While the projected points may differ depending on the source, what is critical is that you choose one source to serve as your baseline projections for comparison purposes. You can then make your own individual adjustments based on potential injuries or other factors that may not be fully taken into account, however you must try and avoid arbitrarily throwing out random projections without any baseline projection source to make justifications based on gut feelings. Thus, while the total salary cap and daily cost of a player are always established by the fantasy website you choose to use, the projected points are something you can make slight adjustments to within reason.
Therefore, when dividing the Daily Fantasy Price / by the Players Projected Points, you will be left with an output in which the lower the number the more undervalued the player is compared to similar positions.
Take a look at our objective analysis of who the most undervalued players are for the NFL wildcard round playoff games.
This weeks most undervalued QB is Ben Roethlisberger, however we may still choose to use Ryan Lindley since given the 60K salary cap constraints the ($1,800) cost of the (9 point difference) could be made up by allocating $1,800 towards a top tier running back or receiver.
This weeks most undervalued WR is surprisingly also the most expensive WR player with the most projected points. Antonio Brown has almost 25 projected points at a cost of $9,200, .However, with almost 100% likelihood of rain at kickoff his projected points may need to be slightly discounted since the weather could effect the horizontal passing game.
This weeks most undervalued RB is Dan Herron which we would agree with given his discounted price and high likelihood of producing double digit points given his role in the Colts passing game.
This weeks most undervalued TE is Jason Witten which we also tend to agree with. However, we feel strongly about adjusting Heath Millers projected points by 2-3 since he will be used as a more valuable asset for the Steelers in short yardage and goal-line situations with Bell out. Thus, when these adjustments are taken into account Health Miller becomes the most undervalued TE.
This weeks most undervalued Defense is the Cardinals which we also like given that it is projected to be the lowest scoring game.
This weeks most undervalued Kicker is Shuan Suisham which we would otherwise agree with, however given the poor weather conditions it may be safer to stay away from him and Justin Tucker and go with Graham Gano or Adam Vinatieri. However, both kickers and defense's are typically more of a crap shoot given the higher number of variables, and thus we feel that it is best to make these decisions last based on your remaining salary cap.
Stay posted to FantasyTurnUp.Com for up to date insight on all your Daily Fantasy Leagues.
Sources for our Daily Fantasy Values are from FanDuel.Com as can be seen below:
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