Let’s assume the DraftKings $3,100,000 contest has a total of 1500 entrants of the possible 2250. (It currently sits just over 1000 and I expect they will get to about 1150-1200 with qualifiers over the next 2 weeks). This also assumes about 300 more people plunk down the $1500 to join (the super grinders pour in almost half a million. This would leave an overlay of $850,000. It also means that on average, every entry of $1500 is worth $2066.67. Obviously, the more entries over 1500, then this value goes down but if it did end at 1500 entries you have a positive expected value.
There is so much information available that the grinders don’t have much of an edge if any on the casual player as long as the casual player does a little homework and stays away from late scratches due to injury. What they do have is a big bankroll so they can take advantage of overlay in almost any contest that runs that has significant overlay and they can play multiple teams to have a chance for a the huge win.
You must be aware of potential overlay situations and exploit them! You also need to understand that even if a contest doesn’t have a “true” overlay (where the contest site has to add money to prize pool), that if it doesn’t fill then at least the vig/rake you pay to the site decreases…example:
Dec 10 DraftKings $7500 NBA Pick and Roll had 728 of 750 entries. $7500 GPP. DraftKings made $11 x 728 = $8008. So although it didn’t fill and have a true overlay, the effect was that the rake/vig that they took dropped from 10% ($11 entry and $10 going to prize fund) to 6.7%. This is the type of rake you would get on a high priced contest not an $11 contest.
Everybody likes to enter the Fanduel contests that are so big each week (including me) and always fill early. However, you never get to take advantage of overlay or even rake reduction in these contests. If you play smart, use a few tip sites (which you can find on our articles/links/sites page) and look for overlay potential, then you will be a “net positive” daily fantasy player.