Heuristics in Betting. Useful Things for You to Know

It is generally accepted that numerous gamblers place wagers according to their intuition and gut instinct. Unfortunately, your intuition is much more irrational than you can imagine because it is based on prejudices (this phenomenon is known among psychologists as heuristics) that are not always a perfect tool for successful betting.

There is a strict reason for us to rely on heuristics, and this is evolution. Our ancestors often faced dangerous problems, and they did not always have enough time in order to analyze a situation. In order to deal with them, the ancestors created different quick-fire methods. Prejudices that happened to be correct were handed down from generations to generations. That is why we still rely on them, though it is a complete mistake.

These are General Principles of Common Heuristics.

Fixation

Fixation influences a humans` ability to estimate quantity subconsciously introducing a compulsive idea into the brains. To be more exact, it has been experimentally proved that a random number (fixation) is able to influence personal opinions even if people will know that the given number will be random.

People unthinkingly connect their calculations with a completely random number. Scientists explain it with the fact that the fixation is comprehended by people as a reference point, and people feel difficulties while trying to make a departure from it.

The given phenomenon is widely applied by marketing experts, and its impact is rather significant in the betting industry. Gamblers should avoid fixation in bets wording and understand that handicaps and spreads are able to insensibly influence their opinions.

Availability Bias

The availability bias makes people pay a greater attention to events that exercise huge influence upon them or that can be easily recollected. For instance, it refers to risks overestimation that is connected with such tragic and dangerous events as terrorist attacks or earthquakes. Earthquakes insurances become intensively sold shortly after an earthquake happens despite the fact that it is unlikely to repeat.

From the betting point of view, you should be ware of placing a great importance on previous or memorable results. The fact is that high-scored matches are easy to recall, but it does not mean that they will be obligatory repeated. In football, gamblers often overestimate frequency of such events as bookings and corner kicks because they are important for the game, and it is quite difficult to forget them. Thus, it influences probability perception and punters` behavioral patterns.

Diversification Explained

The given heuristic term describes a situation when people try to show greater variety when they simultaneously have numerous variants than they do while choosing gradually.

To be more exact, let us consider the following example. If a man is asked to choose five chocolate candies from a box containing an even amount of different candies, his choice will feature much greater variety compared to the situation when the man has to choose five candies in five times.

Punters endeavor to spend more when they have a lot of possibilities. Here, a good example is represented by a situation when punters double bets on a certain team to win and draw according to feelings that these bets are more diversified in comparison with a usual wager on the team to win. However, there is no logical explanation for usual gamblers to stake more.

Sunk Costs and Escalation of Commitment

The given term is used to describe situations when people try to justify their decisions made by increasing a general amount of invested funds despite the fact that potential losses keep increasing and have already exceeded potential benefits. As an illustration of this, let us consider a case when a person stays in cinema till the end of an uninteresting for him movie trying to justify time and money spent to by the ticket.

In the betting industry, the given phenomenon can be found when punters increase stakes and place wagers on an outcome that is likely to generate essential losses, rather than come to terms with immediate (but insignificant) losses. In such cases, people often show irrational belief to justify previous decisions instead of simple cutting losses.

Gambler`s Fallacy in Betting

People tend to believe that short sequence of random events reflect the same laws that are shown by longer ones. However, the people ignore the fact that there is not any statistical correlation between the given events.

The most famous example of the given phenomenon is also known as the Monte Carlo Fallacy that happened in 1913. The fact is that a roulette wheel landed on black 26 times in a row. After the fact when the wheel showed the fifteenth black result, gamblers started placing enormous stakes on red stating that it was completely unlikely that the wheel will land on black again. With this, the gamblers illustrated an irrational confidence that previous results were able to somehow influence following ones.

The Gambler`s Fallacy phenomenon is closely connected with the Hot Hand Effect that implies existence of lucky and unlucky streaks. Here, people face an atypical succession of events, and they start saying that “I have a lucky streak” or “I am on a losing streak”. This situation is particularly common for such plays of chance as roulette, lottery, and crap shooting.

Lessons Learnt

People are not mechanisms, and we try to be rational, but our instincts can confront our intentions. Such mistakes can come with a high price tag to bettors. That is why you should ignore your sixth sense and place wagers according to experience and deep knowledge.