Every single human suffers from cognitive biases. The book Thinking Fast and Slow by Daniel Kahneman takes a look at how humans make errors in decision-making due to biases and heuristics. No one is immune, but you can improve your decision-making (and sports betting) by becoming aware of your biases and taking them into account.
I was re-watching a video on Charlie Munger’s Psychology of Misjudgement speech he gave at Harvard and it got me thinking. If I could become aware of the unconscious shortcuts I was taking in my decision-making, how much would that improve my sports handicapping? After thinking it over for some time, I made a list of different blindspots I think most gamblers have.
Most bettors gamble because they think they can win. Even if they have lost time and time again for years and years, they are in denial about their lack of ability to beat the books. Take a hard look at how you have done in the past, and if you don’t have an edge scale your bets back and look at it as a form of entertainment.
Once a bettor gets new information they have a hard time absorbing that new information to get off of the position. If you like a team and the starting quarterback goes out, maybe after running your numbers you’d be better off taking the other side at a worse number. I know it sucks when you have -7 and +3.5, but both could have been good bets at the time. Don’t let your commitment to the first bet influence the current handicap.
This is a big one. If a gambler loses money on a player or team too many times they give the ‘never again’ statement. They associate losing money with them just like Pavlov’s dog. Learn from your mistakes, but don’t let them prevent you from taking advantage of new opportunities.
Sometimes luxury items that are priced higher are viewed as more attractive by customers. And sometimes in sports betting when a number gets steamed gamblers like it more at the bad price than they did at the opener. Don’t take games at bad numbers just because an advantage player took a bet at a good one. (Don’t confuse this with late info like injuries causing the move)
The sportsbooks will give you ‘gifts’ like odds boosters or free bets if you bet so much on an event. This is done to keep you engaged and to keep you gambling. You should factor these bonuses into handicapping if a bet is a good price, but don’t let their ‘gifts’ lead you to make bad bets.
Overinfluence of Authority
It can be tough to go against someone you see as an authority figure. A good example is the ex-athletes on TV/radio convincing you that something matters that really doesn’t. Or that a certain team is going to win. These guys played the game at a level I never did, but they get paid to entertain. They do that by being outlandish and contradicting each other. A lot of times they don’t watch as many games or study the matchups as much as even a mediocre bettor.
Fear of missing out (FOMO) is always a big problem for gamblers. Did you want to bet something but didn’t? If it wins you will remember that one forever. Were you hesitant to place a bet but someone talked you into it? When it loses you’ll be pissssed and will have a tough time forgetting it. On the contrary, if that bet you wanted to take loses, or the one you didn’t want to take wins, you will quickly forget about it.
There are all kind of tricks casinos use to get you to gamble more. When a gambler feels like he has control over winning and losing he tends to bet more. When you lose but have a near miss you get the feeling of something deprived. Both of these are prevalent in sports betting. You are handicapping games and deciding how to play. Plus, most games you have a chance to win going into the final stretch, there are plenty of close misses.
An additional problem with sports betting is that if you put in a lot of work to handicap games, then you want something to show for it. It can be tough to pass. Studing a game and then not playing it seems like a waste of time for most. I worked on a model for 80 hours one time that I had to toss out. I discovered my data was trash. Trust me that sucked and I was really frustrated but it had to be done.
Stress/Chemical Induced Bias
This is easy. Don’t gamble when you are stressed out. Don’t gamble when you are under the influence of drugs or alcohol. You won’t be thinking clearly enough to make smart decisions and your risk-taking filter will be off. There is a reason casinos give their patrons free alcohol. It ups their risk-taking behaviour and hinders their abilities to make good decisions.
These are just a few biases you should be aware of as a sports bettor. Hopefully, by being aware of them you can put yourself in a position to not succumb to them and you’ll make better decisions in the long run!