What’s the Gambler’s Fallacy?

Despite gambling’s ties to logic and calculations, superstitions and myths in gambling abound. The same can be said for wrong beliefs and illogical thinking, with the Gambler’s Fallacy as the most obvious example.

This article aims to introduce you to the notion of Gambler’s Fallacy or Monte Carlo Fallacy, an inaccurate belief that one outcome in gambling is more likely to happen than another based on previous rounds.

What’s the Gambler’s Fallacy?

You don’t have to be a casino veteran with decades of experience to understand logical fallacies common in gambling. In fact, the longer you stay at online casinos, the bigger are the chances that you are going to spot the fallacy, rather than believe in it.

Almost everyone in the world has believed (or was tempted to believe in) the gambler’s fallacy at least once in their lifetime.

In short, the gambler’s fallacy is the erroneous belief that a specific outcome has better chances of appearing over another. In reality, outcomes have no effect on upcoming outcomes as each round in casino games – especially online games – are statistically independent, i.e., their outcomes are unpredictable and unrelated to each other. An easy example would be the wrong conviction that a win is due solely for the fact that the last few rounds resulted in a loss, or vice versa.

The Gambler’s Fallacy can be quite dangerous for novices as it might provide encouragement to keep playing despite bad results and an overall unsatisfying game session, leading to greater losses (and sometimes even losses that the player cannot afford to lose).

The Monte Carlo fallacy is a cognitive bias that got its name from the fact that it’s often witnessed in gambling, but it is in no way restricted to this branch of entertainment only. Moreover, there are other cognitive biases that you might also encounter whilst gambling online or in person.

Monte Carlo Fallacy Examples

The gambler’s fallacy is not complicated, but it might be the easiest way to understand it through examples – especially if you are a beginner.

Here are some of the most common examples of the Monte Carlo bias in casino games.

Roulette

Imagine participating in a round of live roulette. You watch closely the wheel and conclude that the last 5 roulette wheel spins resulted in Red. Believing that the wheel is ‘due’ for a different outcome, you wager money on Black. On the next spin, the wheel again lands on Red, but you keep betting because for you, the wheel needs to land in a Black according to statistics. That round does indeed result in Black, but the outcome had nothing to do with previous outcomes as each roulette wheel spin is a spin for itself. There is no correlation between two wheel spins, so therefore, saying that one outcome is more statistically likely than another is wrong.

Slot Games

Online slots are common ground for fallacies, but it’s perhaps the jackpots that attract the most attention in that regard. Namely, the gambler’s fallacy in slots is observed when a player is confident that a slot machine (online or not) is due to pay out a big win/jackpot because it has been too long since the last win. The conviction of the player pushes them to bet more and more, and as rounds progress, the player will lose more and more money until they either leave the game or hit a big jackpot. We are sad to say that it is more likely for the player to quit than hit a jackpot, because every round is a round for itself – especially in online casino slots.

Card Games

The gambler’s fallacy is most evident in games of luck such as roulette and slots. With blackjack and other similar games of skill, statistical probabilities and RNG are even harder to prove as players know they can affect the game outcome by making smarter moves. Advanced gambling techniques are often used too – but no technique can predict accurately what card is going to land into your hands next. Therefore, betting on blackjack despite being in a losing streak does not mean you are about to enter a winning streak. It doesn’t work like that. Indeed, losses have no impact on the likelihood of winning the next round. The same goes for all card/table games, including online poker.

Craps

Dice games, such as Sic Bo and Craps, are incredibly easy to play, and as games of luck, they have a lot of appeal for diehard casino fans. But thanks to their nature, players can quickly start believing they can predict the next dice roll. If, for instance, there has been a streak of at least 3-4 dice rolls that resulted in low numbers, a player with cognitive bias will start believing that the next rolls must result in high numbers, as they are ‘due’. We cannot stress enough how dangerous this can be because the players start increasing bets, which can easily lead to incredible losses.

Other Logical Fallacies in Gambling

Monte Carlo fallacy is not the only form of cognitive bias frequented in gambling. There are other, similar biases that are closely related to the gambler’s fallacy that you should know before entering the gambling arena.

Here are the most common gambling cognitive biases:

• Hot hand fallacy
• Illusion control
• Dispositional luck
• Base rate neglect
• Sample size discredit

Check them all out right below.

Hot Hand Fallacy

It’s not rare to see the hot hand fallacy and the Monte Carlo fallacy used interchangeably. However, the two indeed are not the same thing. The hot hand fallacy came from basketball. In essence, it is quite similar to the Monte Carlo bias as both refer to the maturity of chances, or – the belief that you expect that a result ha something to do with previous game results.

However, the main difference between the two lies in the expectation. With the hot hand fallacy, players fully expect the upcoming result to be a continuation of the previous streak, like another win that would complement the previous streak. The Monte Carlo fallacy involves a break from the previous streak, as the players believe they are ‘due’ a certain result because it has been ‘missing’ for a while. For both it is important to remember that cards, dice, nor balls have ‘memory’ so their outcomes cannot have connections.

 Illusion Control

The third cognitive bias on the list is illusion control, which is a notion connecting both the gambler’s fallacy and the hot hand bias. Namely, the illusion control refers to the erroneous belief that you can control the outcome that are not actually under your control. For instance, thinking that you can will the ball into falling into certain roulette wheel pockets, when it’s obvious you have nothing to do with it or cannot affect it in any way or capacity.

Illusion control is observed in various situations in life, but in gambling it is easiest to spot in games of luck. With skill-based games, the control is obvious, but with luck-based games there’s no way to influence the outcome, but some players fully belive they can.

Dispositional Luck

If you ever find yourself thinking that lady luck has favourites, please refer to the term ‘dispositional luck’ in this article. The cognitive bias of dispositional luck involves a firm belief that one outcome is luckier, and therefore more likely to happen, than others. For instance, belief that your lucky numbers are going to appear in a game of bingo simply because you feel they are lucky is a prime example of dispositional luck.

It’s actually more prevalent than you might think, and it happens in most spheres of life, not just gambling. However, in gambling, dispositional luck often leads players to wager on specific numbers they consider lucky at the moment. The luck can shift to other outcomes, of course, which is when players change their bets to reflect the options that they consider lucky. In truth, there is no lucky/less lucky/luckier outcomes – they are all the same in terms of luck.

Base Rate Neglect

This is a common cognitive bias that refers to the act of ignoring or underestimating base rate information in decision-making. That happens when you decide to focus more on specific information rather than the broader context. When base rate information is thusly disregarded, illogical thinking ensues.

The most common time when this happens is when people choose to focus on the (limited) information readily available, going for the easiest route to decision-making. Although it’s quite common in gambling and real life, the easiest way to describe it is via the lottery. If you start thinking that the lottery is easy to play and win because you’ve met a couple of players who have won it so far, you are under the influence of the base rate information neglect. You are purposely ignoring statistics and general information about the lottery and forming your opinion on the highly specific information you have gotten.

Sample Size Discredit

One thing that base rate neglect bias does is discrediting the sample size. You wouldn’t believe how important sample size is for gambling, especially if we are talking about payouts and win probabilities. That is why companies test all games millions of spins over to reach a statistical RTP and win probability. But if we are talking about sample size discredit in this case, let’s use the same example as for the base rate neglect.

Namely, if you know 2 people who have won the lottery, you are going to think that winning the lottery is not a big deal; it’s in fact a very easy feat to do. However, with this you are completely disregarding the fact that millions of players who have played and hadn’t won anything – you know of their existence yet choose voluntarily to ignore that piece of info at the moment. This is the prime example of sample size discredit which, for the most part is not dangerous, but in some cases can lead to overspending at casinos.

How to Avoid Cognitive Bias While Gambling

As you have seen, it is quite easy to fall into the trap of logical fallacies, especially if you are in the casino world.

Don’t worry, we got your back. Casino Chicks prepared a list of our top tips on how to avoid falling into gambling fallacies and other cognitive biases.

1. Learn about cognitive biases.

See what types of cognitive biases are out there, especially those that can potentially influence decision-making while gambling. Once you get the full picture, you will be able to understand how these biases work and how to avoid them.

2. Check your biases via self-awareness.

It is important to keep yourself in check at all times if you want to avoid falling into the trap of the gambler’s fallacy or another bias. Reflect on your decisions to analyze the point from which they came – was it a place of certainty or a logical fallacy.

3. Seek only objective info.

To know more gambling, you need info – but there’s a lot of info out there that can be misleading. Try to inform yourself on the game you’re playing as much as you can before you start playing with real money. Check statistics, paytables, and outcomes.

4. Set limits and stick to them.

Having limits, especially in gambling, is of the highest priority for players. Players with clear betting ranges are less likely to spend money during dry spells in hopes of winning a round. Plus, limits protect you and your money from biases quite nicely.

5. Focus on strategy.

Games of luck are impossible to predict, but players still came up with various strategies which ensure happier outcomes (not really wins, but more like money loss prevention). Pick a strategy and stick to it to ensure your emotions and the atmosphere don’t sway you.

6. Take breathers regularly.

You cannot play well if you are not relaxed, or if you are feeling the pressure of winning back the money you’ve lost. That is why taking breaks is crucial. Breaks help you maintain sharp focus and levelheadedness necessary for gambling online.

These are just some of the small tips we have for players trying not to fall into the trap of erroneous beliefs. There are many other useful tricks and strategies that can help you stay safe when playing games online.

Before We Sign Off…

If you have some that have proved to be useful to you, please don’t hesitate to share them with us! We are constantly looking for ways to improve your experience and offer helpful advice to all women playing casino games. Be sure to drop a comment below and reach out to our team if you have any questions or thoughts to share.