Daily Fantasy Sports FAQ

Daily fantasy sports, often abbreviated to DFS, are a
relatively new development in the world of online gambling and
in the world of fantasy sports. Even so, they’ve already proved
to be very popular. This is particularly true in the United
States, although they’re played in many other parts of the world

As a result of their popularity, a lot of players have a lot
questions about daily fantasy sports. We try to answer all of
these questions as best we can throughout our guide to daily
fantasy sports, which is a very useful resource on the subject.
The purpose of this page, though, is to deal specifically with
the questions that are asked most frequently.

Daily Fantasy Sports FAQ: The Questions

Daily Fantasy Sports FAQ: The Answers

What are daily fantasy sports?

Daily fantasy sports are contests that are fundamentally very
similar to traditional fantasy sports. As with the traditional
contests, they involve creating “fantasy teams” by selecting
real players from a draft. Points are then scored based on how
those players do in actual games.

Recommended Reading

If you know nothing at all about fantasy
sports, either daily or traditional, we suggest reading our
article explaining the basics of fantasy sports
. This serves as
a useful introduction to how everything works and what’s

There are a few differences between daily and traditional
fantasy sports, and one particularly major one. A traditional
league takes place over several months as the relevant sport’s
season plays out, which is a big commitment for some people, but
daily contests are much quicker.

With daily contests, you can enter a league, set up a roster,
and find out whether or not you’ve won or lost in 24 hours. In
the case of football, where games take place over several days,
you might wait as many as four days, but that’s still a lot
quicker than the several months it takes to play out a
traditional season-long league.

Another difference is that when drafting, your opponents
might have some of the same players as you do. In fact, they
could even have the exact same roster. Because of the nature of
this version of fantasy sports, drafts have to take place
quickly. This means it’s impractical to eliminate players from
the draft pool as they’re drafted. Most people don’t want to
invest several hours in setting up their lineup for a DFS

Are daily fantasy sports legal?

One of the frustrations that many poker players and other
internet gamblers have dealt with over the last decade is the
questionable legality of their hobby. This is especially true
for residents of the United States. It’s therefore only natural
to ask if daily fantasy sports are legal before playing.

The good news is that the main federal law governing internet
gambling, The Unlawful Internet Gambling Enforcement Act
(UIGEA), specifically exempts fantasy sports from its
provisions. After all, Congress didn’t want to alienate the
estimated 37 million fantasy football players who vote. This
left the door wide open for this new, more concentrated form of
fantasy sports. It’s legal in most other parts of the world too.

The most telling evidence of the safety and legality of daily
fantasy sports is the attitude that companies like PayPal and
Visa have taken toward these transactions. PayPal is notoriously
unfriendly toward any kind of transaction related to gambling,
yet they have no issues at all processing payments to and from
daily fantasy sports companies. Major credit cards, like Visa
and MasterCard, have traditionally been somewhat wishy-washy
about online gambling transactions, but you’re unlikely to hear
of anyone having a problem using a credit card to fund their
fantasy sports account.

What kinds of DFS contests are there?

You can divide daily fantasy sports contests into two broad
categories; cash games and tournaments.

Cash games are low variance contests where you can expect to
win money around 50% of the time, assuming that you’re an
average player and your opponent is too. Examples of cash games
include head-to-head contests and 50/50 tournaments.

In a head-to-head contest, you’re playing in a miniature
league with only two players—you and your opponent. A typical
entry fee/prize payout structure for a head-to-head contest
might involve each of you putting $20 on the line. The winner
gets $36, and the loser gets nothing. The missing $4 is the
percentage that the site takes in exchange for hosting the

A 50/50 contest is similar, but it has more players. The
players with scores in the top 50% of the field get paid out,
and the players with scores in the lower 50% lose. You might
risk $20 to win $36 in this contest, too, even though you’re
playing in a league with multiple players.

A tournament, on the other hand, has multiple players and a
prize pool for just the top 10% or 20% of the players.
Tournaments often feature guaranteed prize pools. For example,
you might play in a tournament where your entry fee is $20, but
the prize for first place might be $2,000, with a second place
prize of $1,000, and multiple lower prizes as you move down the
list of scores.

Further Information

We’ve covered the basics of the main
types of DFS contests here, but you may want to learn more. In
that case, we suggest taking a look at our article on the
different types of daily fantasy contests
. This goes into much
more detail.

What is a salary cap?

In most season-long fantasy sports leagues there is no salary
cap. Players are drafted one at a time, and once a player is
drafted, he’s not available to the other managers. In daily
fantasy sports you don’t have this limitation, but a salary cap
is included to keep the contests challenging.

A salary cap is the equivalent of an in-game budget that you
use to “buy” the players on your roster. Players’ salaries are
based on their past performance and their projected future
performance. The exact formulas vary slightly by site, but the
salaries for individual players—as a percentage of the salary
cap in use—tend to be similar.

You might get a salary cap of $50,000 with which to draft a
fantasy football team. Choosing players who are a good value
relative to their salary will give you an edge over contestants
who choose players that are a bad value relative to their

How do I get started?

Getting started is easy. You first need to choose which daily
fantasy sports site to join, and then open an account. This
involves filling out a registration form with all the usual
information like your name, your address, your phone number, and
your email address. You’ll also need to put some money into your
account. Deposits can be made via PayPal, Visa, or MasterCard at
most sites. Some places have other deposit options as well.

Top Tip

You can use pretty much any daily fantasy sports
site and have a good experience, but there are some sites that
stand out as being particularly high quality. These are the ones
we recommend using. Please check out our top ranked fantasy
sports sites
before choosing where to play.

Once you’ve set up an account and added money to it, you’ll
usually receive a signup bonus. This is additional money you can
use to enter more contests. These signup bonuses are an
incentive for new players to try the hobby at a particular site.
The bonus amounts are released as you participate in contests.

The lobbies of the major sites are user-friendly, and make it
easy to filter which sports you’re interested in and which types
of contests you’re interested in. You can also order these
contests by how much the entry fees are. Entering a contest
takes you to a page where you get to choose the members of your
team. This page includes lists of players in each position along
with the salary they each cost. Everything from this point is
usually fairly intuitive.

What happens in the event of a tie?

On most sites, if there’s a tie between multiple players,
they usually share the prize money equally. This doesn’t result
in a push situation like it does in a blackjack game, though,
because of the commission. Here’s an example.


You sign up for a head-to-head contest for $10. The prize is
$18. Your opponent winds up with the same score you have. The
prize pool of $18 is split, which means you each get $9 back.
Having spent $10 to enter, you actually lost a dollar.

In a larger tournament, you might encounter a situation where
a tie is still profitable. Here’s an example of how this might


You enter a larger tournament with an entry fee of $20. First
place is worth $2000 to the winner. You tie with three other
players for first place. You each get $500, which is a
significant amount of profit on a $20 buy-in.

How do referral bonuses work?

Most daily fantasy sports sites encourage their players to
refer new players to their site. As an incentive for these
referrals, the sites share a percentage of the revenue generated
by these referred players. These incentives vary by site, but
here’s how a typical referral bonus might work.


You refer your best friend to a site. This site offers 20% of
the rake generated as a referral bonus to the referrer. Your
friend signs up and plays in a contest for $10. 10% of that $10
is kept by the site as a commission. That’s a dollar. The site
pays you 20 cents of that dollar.

It doesn’t sound like a lot of money, but when you get
players participating in dozens of contests every day or week,
it can add up quickly. If your referral plays in larger buy-in
contests, the site’s commission and your referral bonus increase

How do the VIP programs work?

Most daily fantasy sports websites offer frequent player
points to players for participating in contests. The amounts
awarded for various activities on the site vary by site, but
they all work in a similar manner. You can cash your frequent
player points in for stuff in the site’s frequent player store.
Usually you’ll use those points to buy merchandise like apparel.

Sites usually include shipping and sales tax in the frequent
player points cost of each item. So when you send off for your
baseball cap or whatever, you don’t wind up paying some
unexpected amount to cover shipping or sales tax.

Some sites also allow you to cash these points in for entries
to freerolls. A freeroll is a tournament that a site holds which
has cash prizes, but you don’t have to pay to enter the contest.
In the case of a freeroll entry resulting from frequent player
points, it’s just an incentive to keep you playing on the site.

VIP programs are just a fun way to get rewarded for doing
what you’d be doing anyway – participating in your daily fantasy
sports hobby. Serious players might try to take into account the
dollar value of these VIP programs when deciding how profitable
a certain site might be, but recreational players don’t worry
about it too much.