This time last year was the first time every playing fantasy football. For those that don’t play allow Wikipedia to attempt an explanation:
Fantasy football is an interactive, virtual competition in which people manage professional football players versus one another and that allows people to act as general managers of a pseudo-football team. The players that an individual is able to manage are professional American Football players in the National Football League. The different actions people are able to make are drafting, trading, adding/dropping players, and changing rosters. Due to the growth of the Internet, fantasy football has increased in popularity.
Fantasy football is popular because it allows fans to have something to care about in multiple games each week. The “players” on their teams score points for getting catches, scoring touchdowns, and doing just about anything that amounts to playing a good game. If your team scores more points than your opponnats team, you win that game. Office pools or groups of friends are quite popular for forming leagues. Some put money or some other kind of bet on the table. Others play for glory.
Those details aren’t important to understand how I leverage personal finance to help me with my fantasy team though. See, the key to the game is drafting the right talent that you think will do well that season and then setting lineups each week based on anticipated performance. There’s an entire ecosystem of stats, data, experts, news, and interviews designed to help the participants make the right decision. Most Fantasy Football systems have engines that make recommendations based on all that information.
This ecosystem is not unlike that of investing. There’s mountains of data, thousands of “experts”, and dozens of systems making recommendations to help you make the best decision about where and how to park your money. There are all kinds of strategies too. All this amounts to a lot of noise. And the general consensus among personal finance folks is that this should be ignored. The average investor just isn’t able to beat the market regularly and it’s best to just invest in index funds.
When it comes to fantasy football, I can’t just simply index my team. But I can allow the engines, which reflect the wisdom of the crowds, to make choices for me. So 90% of my fantasy football activities are automated. This is similar to indexing in that I’m casting as wide a net as possible.
But, I do leave room to make tweaks to the system’s recommendations. If a player has a particularly bad week then the next week the expected performance of that player is diminished. I don’t allow past performance to be an indicator of future performance. Every player has a certain skillset but in a given week they may not do well. That’s no reason to desert them.
Likewise, I don’t hesitate selling a winner to buy a better one (buy low/sell high) in order to improve my performance. Within the leagues you can drop players from your roster and pick up others, or trade your players for some on another team. Even if I like a player on my team that has done well for me, I won’t hesitate to drop them for someone I can reasonably expect to do better. I keep emotion out of the picking.
You might be thinking this sounds more like active management than I initially led on. But fear not, in the investment world beating the market usually means outperforming thousands and millions of otherv people who think they might be smarter than the average investor. To win in the fantasy leagues, you only have to beat the few people in your league that think they’re smarter than all the experts. One could reasonably expect that the same people that actively trade with thier investments much more likely to play fantasy football too. It helped me win last year, and I expect to do well again this year.