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Fantasy Sports and The Stock Market

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Postby jswede » Mon Aug 14, 2006 3:30 pm

yea, it's pretty much the same, if by "same" you mean that we throw out the 5x5 roto categories and enter in about 100 other statistics. Then we look at both static relationships (balance sheet) and dynamic relationships (eg income / cash flow). Now we look at the "team", or company, within its league, ie industry sector - is the how is the team valued within that league, and how strong is that league? What are the prospects? For the company? and for the industry? How about exchange rates - not just for if you are buying a foreign stock, but for the company itself with respect to where they buy raw materials and where they sell their finished product? How leveraged are they? How liquid are they? Now, let's boil all this down and decide whether we like the stock, er "team"... can we buy ("draft" it or "trade" for it) it at what we think is a fair or attractive level? Wait, we forgot to figure geo-political risk... war in the middle east - missles in N Korea - stay away, or buying opportunity - how does it affect my "team"??? How about inflation? Legislative risk? and this is just the surface...

Point is, it's a lot more complicated that crunching a defined number of stats in a defined arena, then speculating whether you are getting a good price.

You hating math is a red flag to me, if you are serious about putting some serious money to work. A lot of people think they are decent at putting together some ideas based on statistics, and clearing houses (eTrade etc) are making a lot of money off of those people. As are a lot of pros who take the other side of their trades.

Your best bet, at 20, is to get into diversified funds and staying there. Pretty much the exact opposite of what draws you to managing a fantasy team.
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