Will Your Fantasy Football Team Give You the Best ROI?

I recently was asked by a friend to join their Fantasy Football League. They were looking for 10 good players and he knew I met the criteria (one being that I take it seriously). However, this league was geared towards having a significant buy-in with a cash prize so I reluctantly declined. Why you might ask?

First, why did he ask me to play? It might be that I had won our little, no cash prize league, 4 years in a row. How did I do that?  Implementing some basic investment methodologies. That and I really don’t like to lose. Here are some of those ideas.

Homework and Fantasy Advice 

When I say I take my football (and fantasy football) seriously, I, like many, really become fully committed. I watch as much pre-season football as I can (or Sports Center/NFL Network highlights) in order to see how players look and to see if I can find a “diamond in the rough”.  I will even watch ESPN Fantasy Football programs as a means to get “professional advice or ideas”.  Who is going to have that breakout season? Who is in a contract year? (those guys tend to play harder). Which defense is looking pretty solid… this decision I usually base on who is the team’s Defensive Coordinator. Hall of Famer Dick LeBeau (Former Steelers and now current Titans Defensive Coordinator) has been in football for almost 60 years. Wade Phillips (Superbowl Champion Denver Broncos Defensive Coordinator and now current Rams DC) has been wreaking havoc on Offensive Coordinators for over 40 years. Bottom line… I like to go with experience for the defensive part of the “portfolio”.

Selecting The Fantasy Team (My diversified portfolio).

Having played QB in my day, I always first grab the best QB I can. Tom Brady and Aaron Rogers have served me well. You may not be a fan of the Patriots or Packers (I’m a Bears fan via where I grew up), but I like the best/consistent performers in my portfolio. Fortunately, most of my Fantasy opponents have always felt grabbing a running back is the highest priority when drafting. Thus, I normally can get a good “high potential growth” QB pretty easily. Again, I’ve had good success. Running back or Quarterback for first pick? You decide!  

Receivers are normally my next pick… because QBs throw to them! I usually shoot for at least 4 receivers in a 2 or 3 receiver fantasy league team (to play each week). And I usually go after the #2 receiver on the team. Not the #1 receiver. Yes, they are good, but they are so good that defenses look to shut them down. Go with those #2 or #3 guys to get consistent point-returns each week. Grab 2 Defenses (so you can switch them out when necessary), and get a Kicker (more on that in second). Running backs… I like to find those that are trying to prove themselves. I won’t say I wouldn’t be excited if I grabbed an Adrian Peterson or top-tier RB if available, but because I’m “QB-Centric” in my draft, I tend to lose those opportunities which is ok by me. There are lots of no-name RBs out there looking to make a name for themselves. Also, find RBs that can catch because QBs like to throw to them!! Seeing any trends here? Better fantasy earnings potential!

Monitoring: Where are the best Dividends and Earnings Per Share (or points per player).

This is where I “make my money” (so to speak). Do I set my team (or portfolio) and let it ride for the season? Nope! I will first continue to read or watch the Fantasy gurus. Sometimes getting sage advice from those that are “closer to the fire” can be what makes or breaks a Fantasy season. I, like any good Fantasy owner (or investor), also have alerts established so I know right away if one of my positions has taken a big hit for possible losses. In addition, I also go to weekly NFL game match-ups. If I have a running back or receiver who is going up against a top defense, then there is a higher potential (or risk) for low points that week. Thus, I need to rework my team (especially if they go on a bye-week!) This is where I start to head to the waiver wire. In a season, I average at least 40 add/drops. I’m constantly looking for the best match-up in order to see which player can provide me the best “dividend” (or fantasy points) for that week. I may add an under-valued, no-name player because I’ve done a lot of research and see a favorable match-up for the one week. 

Obviously, when a player is injured (Hello Julian Edelman’s torn ACL), that means a low “earnings report” (or in Edelman’s case… no earnings at all). Hence, I have to drop (“sell”) and add (“buy”) something else off the waiver wire that will give me added performance to the overall team or “portfolio”. I have no issue adding/dropping a kicker almost every week. I look for kickers on teams that can’t seem to put the ball in the endzone or are playing a really good defense. The team can get to the Redzone (inside the 20 yard line) but can’t punch it in for a TD. The Result? More Kicker “dividend” points for this Fantasy Owner! 3 points, 3 points, 3 points! It could be (and has been) the difference in a Fantasy win for that week.

Chasing Performance- Be Careful!

My favorite part of Fantasy is when some might “Chase the performance”. What does that mean? When a player (who no one has on their team) comes out of nowhere and puts up mega fantasy points during one week of play. Fantasy owners across all leagues will then normally scramble to pick up this player. You can see their trending percentage in ESPN leagues… goes way up! This normally results in an unhappy Fantasy owner the following week. Why? Because either the next team this player will face watches film on this player and that Defensive coordinator has a game plan to shut this guy down OR this player was just a one hit wonder. When this occurs, I’m usually looking to see who that Fantasy owner dropped in order to chase after that new “stock”. Lots of times the player dropped is a player with a history of decent fantasy performance… he just hasn’t started to “perform” yet within the portfolio. 

Side note:  The best feeling is when everyone is chasing the player I had the week he had a breakout performance (recall under-valued players- I did my homework!). No better feeling when your buddies run to the waiver wire to get this player only to learn I had him already. Doesn’t happen all the time, but when it does, it feels good!

Best Performers hit their Trailing Stop

During the season, don’t be surprised if I have 4 games running at one time on Sunday just so I can see how my Fantasy players are doing. My wife loves it! (read sarcasm there). And of course, like all Fantasy owners, I have the Fantasy games up and running, checking my fantasy points and seeing how my team is doing. While I make decisive moves during the season, the real decision making comes at the end of the season. 

As with most leagues, the ‘Fantasy playoffs’ normally occur during the last 2 weeks of the NFL regular season (sometimes the last 4 weeks depending on your league). However, the last 2 weeks of the regular NFL season could mean all those players you researched, drafted, and reaped the fantasy rewards due to their high performance in your “portfolio” are now going to sit because their coach wants to rest them up for their actual NFL playoffs. This means those positions have done well for the portfolio and bolstered huge fantasy points (can I get a virtual high-five!), BUT outside events have now caused their value to pullback to a point where they hit your “trailing stop”… the value point where it’s time to let them go and find something else that will provide better “earnings potential” (better producing fantasy points) so that I can finish the league strong. Tom Brady and/or Aaron Rogers might have done well during my season, but it might be Matthew Stafford or Phillip Rivers fighting to make the NFL playoffs thereby putting up some serious QB fantasy points that put me over the top and into the Fantasy Superbowl or winning it all. 

It’s always hard to say goodbye to Tom and/or Aaron as they end the season on the waiver, but hey, as I mentioned, I like to win! Normally, by the end of the Fantasy season, the team I originally drafted is no longer there. Only the online, JPEG'd Trophy I earned remains!!

So, this methodology for Fantasy Football seems to be a good formula. Using these “investment strategies” has worked each year I have played (my buddies hate me- Ha!).  And my ROI or Return on Investment (Investment of my time, energy, and player decision making) has been rewarding! I have even helped other friends in other leagues who have reached out for advice on who to play and/or pick up for their team. I enjoy seeing them succeed too.

While fun and enjoyable to me, all my efforts have been in a league where there was no real cash prize. Just bragging rights (if that). Can you imagine what I might do if I laid down cold, hard earned cash? I would probably go insane! It would become a full-time job! I would likely end up in a Fantasy Football Anonymous Program. 

Hence, why I had to turn my friend down.  While I enjoy it, there is still “Fantasy Risk”…anything can happen on any given Sunday and with money tied to it, I didn’t want that stress. Plus, imagine what I could do with the money I saved? Maybe put that to work! 

All said, many, many men and women will be out there trying to win their respective Fantasy league. And many will implement their own strategies to get the coveted “trophy” (however defined in that respective league). 

What’s interesting is these same folks probably don’t really know what’s in their actual investment portfolio (401ks, IRAs, etc.). Do they spend the same amount of time on their investment portfolio as their fantasy team? Do they seek out advice from those that are “closer to the fire”? Are they diversified to manage their risk? Do they look at the dividends being generated or potential earnings? And do they have a strategy for when to cut a poor performer or a good-performer that has lost steam? 

Doing so may improve their “Fantasy Retirement ROI”.

Commonwealth Asset Management Group (AMG), LLC is a Registered Investment Advisor. This content is provided for the informational and educational purposes only and is not to be considered specific investment advice or a recommendation to take any particular investment action.