Confirmation Bias & Loss Aversion

## Confirmation Bias Confirmation bias is the tendency to search for, interpret, and remember information in a way that confirms what you already believe. If you think a team will win, you subconsciously discount evidence to the contrary and amplify evidence in your favour. You read the team news focusing on the good (key striker fit) and minimise the bad (three key defenders out). **In practice:** After placing a bet, bettors often stop evaluating impartially. The analysis ends the moment the bet is placed. The discipline is to continue questioning your position right up to kick-off. ## Loss Aversion Daniel Kahneman's research showed that the pain of a loss is roughly twice as powerful as the pleasure of an equivalent gain. Losing £50 hurts about as much as gaining £100 feels good. This has direct betting consequences: - **Chasing losses:** After a bad run, bettors increase stakes to recoup faster — compressing the time horizon and increasing risk of ruin. - **Cutting winners short:** Bettors cash out winning bets early to lock in profit, even when the expected value of holding is higher. - **Avoiding correct bets:** Bettors refuse to back a team they previously lost on, even when the price is genuinely good. ## The Antidote Think in expected value, not outcomes. A bet with positive EV is correct regardless of whether it wins. A bet with negative EV is wrong regardless of whether it wins. Detach from individual results — track performance over hundreds of bets, not tens.