Beware of the Gambler’s Fallacy

You may have heard the term “gambler’s fallacy” used in areas of your life that had nothing to do with actual gambling. The phenomenon describes a human thought process that identifies patterns and then assumes the pattern will continue to occur. Or, because of that pattern has occurred for so long, that it is bound to stop any time now. People tend to do this with their every day lives and they DEFINITELY do it with gambling, hence the naming of the phenomenon.

One peculiar aspect of the phenomenon is that once the individual has made up their mind, they stay locked into the belief even when presented with information that the contrary will happen. This part of the phenomenon may be referred to as “tunnel vision”.

Usually at the end of the cycle, after the bet is lost, the person will recognize their participation in this fallacy and think things like “How could I not have seen that angle?” and “I knew that was a bad bet.”.

The fallacy is also known as “The Monte Casino Fallacy” because in the year 1913, a well documented event occurred one evening. The roulette table landed on “black” 26 times in a row. The odds of this happening were 1 in 66.6 million. Patrons lost millions of francs betting on “red” during this streak. They were sure each and every spin that, because the ball landed on black X amount of times in a row, red was surely going to come up next.

So, this weekend, think about the gamblers fallacy when betting the games. Just because team A has covered the spread against team B, X amount of times in a row, by itself means nothing. Every year is different and this may be the year the trend ends. Trends can be a good factor to consider, but by themselves are not enough to risk your money.