Daily Fantasy Sports Basics – What is a Guaranteed Prize Pool (GPP)?

Guaranteed Prize Pool

In “Daily Fantasy Sports Basics,” we give you quick answers to questions you might have about terminology and basic strategy from the world of Daily Fantasy Sports.

The most popular type of contest in today’s daily fantasy sports landscape are ones with a guaranteed prize pool.

What does that mean? It refers to a contest in which a daily fantasy sports site makes the entire prize pool known in advance, no matter how many people enter the contest.

The more money that is guaranteed up front, the more you can win. During the NFL season, especially, contests at the largest sites, like FanDuel and DraftKings, will be in the millions of dollars.

DraftKings has also started guaranteeing huge amounts for its golf contests around the major tournaments. One GPP contest for the Masters guaranteed $2.2 million, with $1 million for first place.

Guarantees will often be smaller for other sports and leagues — like NBA, NHL and MLB — although contests can still be guaranteed in the tens or hundreds of thousands of dollars, depending on a number of variables.

DFS contests generally guarantee prize pools so that they do not run afoul of state laws, which usually require the prize pool for a DFS contest to be known ahead of time. It’s also a good marketing tool for sites, as they can tell players how much money is up for grabs at their site, in advance.

If the number of entrants in the contest doesn’t cover the amount of money guaranteed, then there is an overlay. You can read more about overlays here. Identifying overlays is one of the best ways to make money for the average DFS player. Smaller sites — outside of FanDuel and DraftKings — will often feature overlays for their guaranteed contests.

Photo courtesy of 401kcalculator.org.