Skill v. Luck is Difficult to Illustrate, Because Professional Gambling Is Boring

The peeps were chatting about "skill vs luck" in pari-mutuel games today, in this case daily fantasy sports.

This, as we've seen, with statements from the press and others during this debacle (in my view, that's exactly what this is), is often misunderstood.

Winning long term at a game that involves skill versus luck is not sexy. It's not something you can "show" on a short youtube video. It's not something you can show on a TV commercial.

It's a grind, and it's really boring.

Picking a player that will likely do well, with some confidence, is not difficult. Todd Gurley should have a good game against the Vikings. Tom Brady should be able to score some fantasy points against Washington. Anyone should score some points against the Saints.

In horse racing, we can all pick winners. In fact, the odds board picks the top two places about 6 or 7 of ten times.

Look at any graph at odds levels with low variance choices and expectation. It's a pretty smooth curve with the takeout your loss level.

So it's all luck right, or fraud, like early on some newspapers led you to believe?

No. The skill in any game lies solely on the margins.

It's what you do with your choice - ticket construction, sound betting philosophy - that tends to matter. It's the one of twelve times you successfully fade Todd Gurley or the chalk in a race that tends to matter. It's the 1% ROI you receive on these bets over a year that tends to matter.

You can't follow that with a camera and a big plastic check. It's completely boring.

The skill to win at racing, or DFS is Warren Buffet. After a short period of time some of his investments look silly, and he doesn't have the flash of a fly-by-nighter that just scored a check because she wrote naked puts on cocoa before an unexpected tropical storm. But when the cameras are off, this boring, ugly grind wins.

Managing the boring, sticking with a plan, not getting caught up in the day to day trying to look like a winner, is the definition of winning at a skill game.

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