The Gambler’s Fallacy
In the world of gambling, it is frequently said it’s a matter of fate if you win or lose. It’s the hazard that dictates in which direction your fortune goes. As humans, we often make use of patterns to navigate through life. It helps us face the unknown by associating old events with something familiar. But what if these survival instincts sometimes interfere with our pleasures? To be human and play games of fortune can be complex.
It is normal to be precautious when gambling, and some say the best strategy is to take a leap of faith. But many fall for what’s known as the gambler’s fallacy. To be a skilled player, you must first understand what limits you. In this article, we set up to discuss what is the gambler’s fallacy and how it affects gambling experiences.
What exactly is the gambler’s fallacy?
We can start with an example: Sam loves playing Roulette, and he is very good at it. His latest experiences, though, lead him to lose round after round. He experienced this in the past before and noticed a pattern: these losing streaks end with his third casino visit. So tonight is his third night at the casino, and Sam walks in all confident that he will win. Many hours later, Sam is defeated and lost significantly more than before.
How could this be possible?
Sam fell victim to the gambler’s fallacy, which is the misbelief that if an event repeatedly happened in the past, it will most likely happen again in a future situation, under independent circumstances (or vice versa). Sam’s losing streaks had nothing to do with him winning or losing that night.
Why do we fall for it?
We stated before that as humans, we like to see the world in patterns. It gives us a sense of control when we move on through life. Odds or chances are external values we can’t influence, so naturally, we’d instead try to guess what’s happening next than waiting to see what faith brings to us.
Thus, the gambler’s fallacy functions out of two scenarios:
- If a specific event frequently happened in the past, then it’s less likely to occur in the future.
- If a particular event happened less often in the past, then it’s very likely to occur again in the future.
We expect that a succession of outcomes (let’s say 10 straight blacks in Roulette, will be evened out by a red number) will influence a false predicted scenario. This happens because we don’t quite grip the idea of odds, especially when we talk about the law of large numbers.
The hot hand fallacy
The opposite of the gambler’s fallacy, the hot hand fallacy is mainly popular in sports, when it’s believed that if athletes are on a “hot streak” they will continue to score. Why is that? Because the expectation that consecutive successful outcomes will continue in the long run is in itself a misbelief.
The same principle applies to the gambling world because it makes us believe that success will continue on and on if we are on a winning roll. The reality, however, is different, and it involves more than momentum. Hot slots and Roulette patterns for example run on chance. It’s a common practice to get carried away and start betting, thinking that good luck is here to stay. In reality, it’s probable to lose a lot of money and have less fun instead.
How can betting systems help us?
When we speak about betting systems, regardless if it’s Roulette, Blackjack, or Sports Bettings, they are all based on odds and have little to nothing to do with intuition or winning and losing numbers. What does this mean exactly? That you can keep a specific game plan according to a betting pattern only when you understand that winning and losing are both probable. Avoiding the gambler’s fallacy is the best way to help your betting strategy. Remember that events are independent situations that do not correlate and can not affect one another. This is a safe way to maximize your chances of having profit when luck is on your side and minimize losses when the inevitable bad luck approaches you.
The Monte Carlo incident
The gambler’s fallacy is also known as the Monte Carlo fallacy. You’ve probably asked yourself what’s the correlation between the two. The Monte Carlo incident is an example of a gambler’s fallacy that made history. It occurred in Vegas of 1931, at a game of Roulette. The ball had fallen on the black square many times in a row, making people believe that the ball would fall on red next. So they started betting and pushing their chips on the red square. The ball had hardly fallen on red after 27 wheel turns. Due to a collective gambler’s fallacy million dollars losses happened that night.