Gambling Fallacies
There are so many people who claim to be profitable when betting on sports, or any form of gambling. So why is it that the records suggest that fewer than 2% of the gambling population actually make a consistent profit? Here at Bet Advisor, we strive to do our bit to increase that small number by sharing profitable advice with our members, from some of the sharpest minds in the industry – from guys who are part of the two percent. Here are a few fallacies in the gambling world that are worth thinking about:
1. “Back Winners, Not Value” – This concept is flawed, pure and simple. Theoretically it makes sense, providing you always know what will win, but obviously, no one can! The idea is that you should ignore the price, and simple go with what is most likely to win. This is a huge flaw in any betting strategy, and value will always prevail in the long term. As an example, if Arsenal were to play Aston Villa at home, everyone would expect a home win, so someone adopting the “Back Winners, Not Value” would back Arsenal. If Arsenal were priced at 1.25 would mean to make money using this approach, you’d need Arsenal to win this game 80% of the time to break even, and more to make a profit. A quick look at the history when Arsenal are at home to Aston Villa reveals that Arsenal have won just 5 of their last 10 home games against Villa. Backing Winners in this instance would’ve resulted in a loss of 4 units from 10 bets (-40% Return on Investment). A value sports bettor would have backed the underdog here, having worked out that Arsenal have a smaller than 80% chance of victory and back Aston Villa, the Draw, or an Asian Handicap line to bet against Arsenal. Backing Aston Villa +0.50 even as low as 2.50 (this line would be priced much higher) would’ve seen the value sports bettor win 2.5 units from 10 bets (25% ROI). Conclusion – VALUE WINS
2. The Monte Carlo Fallacy – This is a well known incident that took place in Monte Carlo in 1913 where the failure to understand statistical independence cost people (and made the casino) a fortune. By the time “black” had won an unprecedented 15 times in a row, people began piling the money on red as “surely black can’t win 16 times in a row”. It did, and it was black the spin after that, and the one after that – the ball landed on black a whopping 26 times. The problem here, is that many people presumed that the previous spins had an impact on future spins, despite them being statistical independent events. This fallacy can also be reversed, whereby someone decides that because something has happened so many times, that it is more likely to occur again. This ‘reverse fallacy’ is equally as flawed. In sports betting, this doesn’t translate literally, as sporting events will typically have some impact from previous events – whether it be player injuries, player form or something else. The question then is how to apply the importance of past performances on future games. Just look at Sunderland this season. They conceded 1 goal in the three games leading up to their 8-0 drubbing at Southampton. The fact is, there will always be a level of statistical independence in sports, the trick is to calculating how much
3. Illusion of Control – When betting on sports, you need to remain humble at all times. Picking a few winners does not make you an amazing sports bettor. Why? Well, you need to establish how you won the bets. Was there any luck involved for example? Many people believe they have the skill to beat the books, but struggle to do so, and this is because of the overestimation of skill when compared with chance. Skill can help get a slight edge, but there is nothing you can do to cater for a bad refereeing decision or a freak own goal. Things happen that are out of anyone’s control and understanding this is vital to become a profitable sports bettor. Similarly, after an event, you need to understand that losing bets weren’t necessarily bad bets, and a winning bet wasn’t necessarily a good one.
4. Pseudo-Mathematical Errors – There are several mathematical presumptions in sports betting (and any form of gambling) that people often believe to be true, when in fact are anything but accurate. For example, some people say you should never pick consecutive numbers in the lottery, because it is incredibly unlikely to occur (eg. 1,2,3,4,5,6), when in fact, it is exactly as likely as ANY other selection of numbers. Another example, closely linked to the Monte Carlo fallacy is the fact that some people presume that the gambling gods will “even out” a series of results. This isn’t the case, just because a coin flip is a 50-50 chance, doesn’t mean that after being 400 heads and 100 tails after 500 coin-tosses the next 500 will read 100 heads and 400 tails. Being able to understand this will help to become profitable in the long term – let go of misconceptions.
At Bet Advisor, we want to educate those who want to take the next step in their sports betting. As well as being home to some of the best sports tipsters in the industry, we also want to give the public the knowledge they need to avoid certain pitfalls and mistakes that would usually stop them making a side income (or more) from betting on sports. Check the blog next week as we look at another topic to help ensure you make a profit when sports betting.