Sites providing daily fantasy sports and those offering traditional sportsbook betting have some features in common. Both offer a way to profit from your sports acumen. Both are based on the outcomes from real sporting events. Because of these strong associations between the two, it's natural for people to lump them together. But I think that's unfair to both forms of wagering – they both have their pros and cons.
When you compare DFS and play at offshore sportsbook sites, it doesn't take long to notice some important differences between the two events. In this article, we compare the pros and cons of DFS and sports betting, to see how the two work, how they're different, and help people figure out which is right for their needs.
Sportsbooks offer odds on sporting events that their customers use to place wagers. As a sportsbook customer, you pick the event, how to bet, and how much to bet (within a limit).
DFS sites host what fans call tournaments – the world's biggest DFS sites hold thousands of these events every day, with buy-ins ranging from free to thousands of dollars. The prize pools of these tournament events depend on the number of people in the contest. The action that determines the outcome is identical to fantasy sports ownership. Think of DFS sites as monetized fantasy sports play, and you're not far off.
Major differences between the way that daily fantasy and sports betting works should now be apparent. The biggest difference – who you're gambling against. Daily fantasy tournaments pit you against other owners, real people with varying degrees of sports knowledge. DFS sites earn their bread and butter acting as a middle-man, skimming their commission off every tournament fee payment. Sportsbooks pit you against professional bookmakers whose job it is to guarantee a profit for the book.
I won't say that one is better than the other – only that they're different. To further investigate the differences between these popular forms of wagering, let's look at advantages of both daily fantasy and Web-based sportsbook betting.
When you gamble at a sportsbook, you'll have a much wider range of sports and wager types to choose from. A typical sportsbook site has two or three dozen different sports in their coverage, not to mention all the various additional ways to wager, like parlays, props, and other exotics. Sportsbooks offer a longer list of markets and wagering styles than DFS sites, which tend to cover just two or three sports markets. Even though lots of sportsbook customers focus on just one or two sports, they have more choice even within those one or two markets than DFS fans have in their sport of choice.
One of the problems I have with DFS is that only two sites are really relevant. Outside of Draft Kings and Fan Duel, there's no one else that's really competitive in the industry. That's not the case with the sportsbook industry, where dozens of major sites around the world are competing for customers. Competition is good for consumers, and the end-result for sports bettors is a ton of competitive features, bonus offers, and other attempts to attract their money. The vast number of sportsbooks competing also gives customers the option of really shopping around to find the site that fits their needs. Web-based sports bettors use the variations in prices for matches as a strategy, and that's only available because of the large number of different books on the market. If you're into DFS, Draft Kings and Fan Duel are all you've really got to pick from. Unfortunately, they have similar (and in some cases identical) commission structures, so you can't shop around for a better deal.
I was researching an NBA futures wager this morning, and if I'd decided to back the Philadelphia 76'ers to win the 2016 championship, I could get +25,000 odds. If I'd wanted to, I could have wagered less than the cost of a night at the movies and waited to collect a potential payout of $250,000. That's the maximum winnings allowed by this particular sportsbook, and I could have maxed it out with a $10 bet on a longshot. So long as most DFS players are paying $1 for a potential top prize of $100, sportsbooks will always have the upper hand in terms of payouts. Big six-figure paydays aren't yet a regular part of the DFS scene, occasional tournament prizes notwithstanding. Parlays, teaser, pleasers, and even progressive wagers are available at sportsbooks all over the world, all of them paying out more in a single day than the average DFS user will win over the lifetime of his account. Regardless of the likelihood of these big-prize payouts, which is admittedly small, they're still available. Some players will always want to chase big paydays.
When you take part in a DFS tournament, you'll be playing against people of mixed abilities. Some DFS competitors are professionals, earning enough money at their hobby to quit their day jobs and play DFS full-time. But the vast majority of DFS owners are regular Joes betting $5 or $10 at a time in the hopes of earning a quick injection of cash. Like in any event, the competition at lower-stakes tourneys is likely to be really soft, while the best DFS players congregate in higher-stakes events. What's nice about facing easier competition is that it means you have an edge, and if you can get to a place where your edge is higher than the commission taken by the site, you're a profitable player. When you compete at a sportsbook, you only have to outsmart one competitor. Unfortunately for sports bettors, it's a real Goliath of a competitor, a high-quality bookmaker with years of experience turning a profit against the public.
When playing DFS you'll be interested in the performances of individual players and can take a narrow statistical view. It means less research, though not necessarily easier research. Creating a good DFS roster and strategy requires the same depth of understanding of statistics as successful sports betting, but you'll be doing a lot less of it. If you discover that you have a talent for DFS strategy, it means you have skills that you can apply to fantasy sports and other DFS markets. It's not, however, a sign that you should move into traditional sports betting, as the skills required for the two are almost totally different.
If you want to bet on DFS or traditional sportsbooks but you have a tiny bankroll, you're better off sticking to a daily fantasy site. The first time I played DFS, I deposited $5, just to test the waters. I'm not sure if I could find a sportsbook willing to accept a $5 deposit, but even if I did, I'd be pretty limited in terms of how many wagers that money would place. By opening a DFS account with just $5, I could play in an unlimited number of contests, thanks to freerolls. I could also enter twenty $0.25 tournaments, each of which could earn me $100 or more, if I took the top prize. Because of restrictions to deposits and withdrawals at sportsbooks, and because of the ease of use of DFS site cashier departments, those of us looking to make a smallish investment are way better off playing daily fantasy. $5 just doesn't get you very far at an offshore sportsbook. Because the initial investment is lower, DFS is much more wallet-friendly to the average bettor than offshore sportsbooks, where smart money rules.
At this point in the history of the burgeoning DFS industry, it's a profitable and buzzworthy enterprise with a ton of commercial support and a large roster of active customers. Though Web-based sportsbooks no longer have that same sheen of novelty, they're highly-profitable and (outside of the US) highly-visible, thanks to marketing. In that way, they're very similar.
But in a lot of important ways, the two are different. Remember that you're wagering against a real person at daily fantasy sites – and while you're wagering against a real person in the form of a bookmaker (or group of bookmakers) at a sportsbook, that's not really a level playing field. At the same time, the potential profits at a sportsbook are much larger, as is the variety of sports and betting styles available.
It's not really a matter of choosing between DFS and traditional sportsbook betting – there's no reason why a person can't take part in both. After all, they require a similar style of research among a pool of identical athletes and teams. If you can afford to bankroll a DFS and sportsbook habit, the above information and opinions should help you make a decision about which to choose.