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Decision-Making Biases

A strong capacity for self-control sets professional bettors apart from recreational gamblers. This allows them to make objective decisions when making a bet.

Yet, as human beings, emotions still play a large part in our decision-making. As such, certain subconscious elements can make us fall prey to bad choices.

These subconscious elements are typically referred to as cognitive biases. They're inherent errors in reasoning that make you misinterpret information from your environment. This leads you to make inaccurate or wrong conclusions.

Although they're subconscious, identifying these biases is the first step to avoiding them. Here are 7 decision-making biases that bettors usually fall victim to. Read on to know all about them.

1. The Gambler's Fallacy

This is the tendency to interpret patterns in past events to predict future outcomes. The gambler's fallacy is one of the most well-known biases and isn't confined to gambling only.

A simple example of this bias is when playing roulette. Above the roulette wheel is a sign showing the results of the last 20 spins. If it shows a previous streak of landing on a black number, you'll get inclined to think that a red number is next.

This is the tendency to interpret, remember, or look for information that supports our pre-existing beliefs.

The error in such a conclusion is that the previous results have no predictive value. You can't infer from the past results because each spin of the roulette wheel is independent and random. In sports betting, this bias can occur when you think a team is due to lose because they've been on a winning streak.

2. Confirmation Bias

This is the tendency to interpret, remember, or look for information that supports our pre-existing beliefs. We tend to forget or ignore information that contradicts our hypothesis. Confirmation bias is also one of the more common cognitive biases.

There's a common belief in blackjack that bad players at your table can have a negative effect on the cards you get. The statistics of this belief are faulty since it's also as likely for a "bad player" to save the table.

Yet, it's easier to blame bad outcomes on bad players. Our memory adjusts to this bias and remembers bad experiences with such players.

Everyone has pre-existing beliefs. Some are valid, while some come from unreliable reasoning. Confirmation bias plays a role in what's called the illusory truth effect. Here, repeated exposure to false information makes you believe it's true.

3. The Availability Heuristic

This is also known as the recency bias. Availability heuristic makes you put more weight on recent events when making decisions.

It's called the availability heuristic because it's a mental shortcut. You turn to information or ideas that are immediately available to you.

Heuristics aren't bad per se. They're strategies that help shorten and make you more effective at decision-making. Yet biases and heuristics can sometimes go hand in hand.

For example, say you make a good decision not to place a bet. However, the bet wins. You then decide to make a bet in the next similar situation, even if it's a bad bet.

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4. Hindsight Bias

In hindsight bias, people look back at past events and come to see that they're predictable. They get the feeling that "they knew all along" even though the outcome was random or there was no way to predict it.

The problem with this bias is that people attribute certain causes to random events. This oversimplifies both the causes and the outcome. Thus, they'll think that coming events are also predictable.

What's interesting about this bias is that it's more common in instances with negative outcomes. When someone loses a bet, they become sure that the winners were predictable. They were only foolish for placing the bet that they did.

Hindsight bias is an easy mistake to make. Remember this when you're playing in Gambling.org's best online gambling sites.

5. Outcome Bias

With outcome bias, you tend to judge a decision by its outcome instead of the quality of your decision-making. This bias is difficult to overcome because sports is an industry ruled by outcomes.

For example, when a bet loses, we tend to see it as a bad bet. When it wins, then it's a good bet. Yet, the quality of a bet lies in the process that went into the decision, not the outcome.

A clearer example is taking $1.50 on a coin toss and winning. You won, yet it was a bad bet.

Meanwhile, say you took $2.50 on the coin toss and lost. The best was still good even if you lost. A good decision to bet is still a good decision regardless of the outcome.

6. Optimism Bias

This might be one of the more foolish decision-making biases in gambling. This is the tendency to think that we're unlikely to get a negative outcome compared to others. The underlying idea is that you're special or lucky.

The problem with this bias is you base your decisions on hope rather than reliable calculations. While optimism isn't bad, make sure to base your decisions on objective considerations.

7. The Affect Heuristic

The affect heuristic is another case of decision-making biases based on emotions. "Affect" is a psychological term for emotional response. With the affect heuristic, you make decisions according to your current emotions.

An example is betting on your favorite team to win, even if it's a bad bet. You base your decision on sentimental considerations, in this case, loyalty.

The affect heuristic can occur beyond the involvement of favorite teams. You favor one team over another because of your sentiments of certain players. This bias can be insidious and is one of the more difficult biases to overcome.

Avoid These Decision-Making Biases

Betting needs a clear head and good judgment to win. Yet as human beings, our faculties have inherent limitations. You must identify the cognitive biases that can affect your decisions.

Nathalie Nicole Smith states that working hard and staying true to yourself are sure ways to win in life.

Remember the common decision-making biases above. Be mindful every time your mind attempts a shortcut. Assess how you came to your conclusions and make sure the process is reliable and objective.

Want to know more about making good bets? Check out our other articles here.