Five Fallacies Gamblers Need To Know (And Why)

Gambling involves a lot of mathematical mumbo jumbo that the average player may not understand. We see the outcomes, but we don’t always know the inner workings that fuel them. And yet, we play. The same goes for our headspace. Deep down, most gamblers know there are psychological factors encouraging more play or pushing them to chase wins. Our brains are essentially programmable, and gambling operators have the code. 

While it’s important to keep the house edge and other mathematical intricacies in mind, you can give yourself a mental edge by knowing common fallacies or psychological shortcomings. When you notice them happening, it’s much easier to keep them in check. Whether you’re a sports bettor, prediction market trader, poker player, or slot spinner, you should know these five mental concepts before you play.

The Sunk Cost Fallacy

If you play for a while, you might start to think, “I’ve come this far, I should keep going.” Doing this in search of a win is an easy psychological trap to fall into, and it goes hand-in-hand with the gambler’s fallacy (which I’ll cover next). Playing because of what you’ve spent instead of what you have left in your budget is a recipe for a bad time. 

• Example: Doubling a blackjack bet to win back your losses or refusing to walk away from a slot session because of how much you’ve already put in. 
• Why It Happens: Sunk Cost is where “chasing losses” can come from. You keep playing to recoup your losses, when the reality is that our odds are the same in a given hand or game round. 
• How to Avoid It: Set your budget and quit if you lose it. Stick to your limits so you don’t fall into the sunk cost pitfall. 

The Gambler’s Fallacy

This one’s a classic. The Gambler’s Fallacy involves thinking a win is “due” after a streak of losses. It has less to do with your actual bets/money and more with a game’s tendency to vary its outcomes. 

Think of a roulette table with the last 10-20 outcomes listed, and you see a bunch of black wins with only a touch of red. You might think red is “due” to hit. Or, perhaps on a slot machine, you’ve lost 10 spins in a row. The bonus is sure to hit soon, right? Wrong, at least in most cases. Remember, the odds are the same for any round, spin, or game. What has happened in the past does not impact the future. 

• Example: Betting on red after a long run of black at the roulette table. 
• Why It Happens: The brain searches for patterns and connects dots that aren’t always meant to connect. 
• How To Avoid It: Ignore displays that show the last handful of results, and don’t let them influence your decision. 

The Hot Hand Fallacy

If the Gambler’s Fallacy assumes a streak of losing will beget a win, then the Hot Hand Fallacy is essentially its opposite. This fallacy involves assuming you’re on a “streak” and that the game or machine is “hot.” You’re winning, so why would you stop? 

This takes many forms, as far as the terminology goes. You might be “on a run,” or “in the zone,” or “locked in.” Beware those terms and their associated feelings. 

• Example: Building a large, inadvisable parlay after a series of wins at the sportsbook. 
• Why It Happens: Again, our brains love patterns so much that they will create them out of nothing. This is confirmation bias at its finest. 
• How To Avoid It: Treat every bet or game round as its own event. Don’t allow yourself to believe one bet can influence another.

The Illusion of Control

This is the only fallacy/common pitfall I advise you to have a little fun with, as long as you’re reasonable about it. Remember that outside of games with minor elements of skill like blackjack, gambling is entirely chance-based. You may develop superstitions about specific ways to “influence” outcomes, but they’re just as chance-based as someone approaching it completely randomly. 

I say “have fun with it” because certain behaviors like this are harmless, so long as you don’t assume they’ll actually give you an edge. So go ahead and blow on those craps dice, talk to the slot mascot on the screen. Pick your lucky numbers for the lotto. 

• Example: Pressing “spin” on a slot machine with specific timing in the hopes that it will influence the outcome. 
• Why It Happens: We like to be in control! We’ll convince ourselves we can sway results even when we can’t.
• How To Avoid It: Remind yourself that gambling is all about chance at work. Little idiosyncrasies are fun, but don’t assume they’re actually making a difference. 

The Near-Miss Effect

Slot machine developers love to use this little trick. You spin the reels and two bonus symbols land on reels 1 and 3. You just need one on reel 5 to earn the bonus. The reel highlights with slick animations and comes to a stop in slow motion, only for the symbol you needed to slide past and land just off the screen. IF you're not careful, you can take this as a sign that the bonus “wants” to hit. It’s due!

Of course, it isn’t, and the next couple of rounds are just as likely to result in losses as they are to hit the bonus. 

• Example: Assuming your next lotto ticket will win because the last one was one number off. 
• Why It Happens: Near-misses activate the reward center of our brains and encourage playing more to seek a payout. 
• How To Avoid It: Enjoy the moment when a near-miss happens, but acknowledge that it has no bearing on the next round.

The Real Pattern: They’re All Related

Most gambling-related fallacies revolve around our brains finding patterns where there are none. The actual pattern at work is completely psychological. We’re hardwired to create a narrative surrounding our experience. When we’re losing, we assume we’re “due.” When we’re winning, we assume we’re “hot.” Our minds will find a way to convince us we’re on the up-and-up, when the reality is that gambling is always a game of chance. Use your knowledge of these fallacies to play responsibly!