How to improve your Wagering Decisions

The team at The Rating Bureau have provided another education article on how to improve your Wagering Decisions. Punting down to its core is about making good decisions and in this article, they explain how to improve that process.

For similar articles to improve your wagering IQ, head to the Betfair Hub.

Where to start

When you break down the game of punting to its basic core principle, it’s simply about making good decisions.

As punters we make decisions about:

  1. What information to use?
  2. How to analyse that information (time, effort, methods etc)?
  3. What importance to place on various aspects of information?
  4. What races to bet in and what races to pass?
  5. What horses to back?
  6. How much to have on each bet?
  7. When and where to place our bets to get the best price?

These are all decisions we are in 100% in control of and that means we are totally in control of our own punting success.

It’s not like trying to become an elite footballer, tennis player or basketballer, where no matter how motivated we might be, the level of physical skill and conditioning required is likely beyond us. It’s not like trying to run a business where factors beyond your control can limit success.

While you must acquire some knowledge and skill for punting, we ultimately create our destiny through the ongoing decisions that we make.

Improving your Wagering Decisions

If you haven’t achieved the results you want from punting so far, then it really does come down to the decisions you’ve made.If you can find a way to improve the quality and consistency of your decisions then you will improve your punting results, that is a guarantee.

When it comes to making improvement, it’s important to recognise there are two parts to the puzzle:

  1. The decisions you are aware of that need to be improved
  2. The decisions you might not be aware of that are limiting your game.

The Decisions you are aware of

Ask yourself the following two questions:

  • What decisions do I tend to make well?
  • What decisions do I tend to make poorly?

If you think long and hard to develop quality answers to these questions then you will likely reveal more about what you need to do to become more successful than you have ever realised before. It’s not all about finding a better selection strategy!

It’s easy to go day by day as a punter wishing that you could break through to the next level of success without really stopping to think how your own decision making is holding you back.

In order to improve in the areas that you know are a weakness, you need to look into those decisions and ask yourself:

  • Why do I make those decisions?
  • What is driving me?

For example, you may have identified that you make too many impulse, unplanned bets. There’s that moment in time where you know that you didn’t plan to back a horse out of your normal analysis process, but something in the spur of the moment makes you think “yep, I’m going to bet.”

It’s one thing to know that you make too many impulse bets, but that’s the effect. You need to understand the cause. What is driving you to make those bets each time?

Perhaps you are simply craving the thrill of more betting action?

Sometimes you might be focused on the thought of needing to get back recent losses. On the other hand, you might think that because you are winning you can afford a loose bet or two. That it doesn’t really matter if you lose and it will be great if you win more!

Perhaps you think the horse ‘must be a certainty’ because it has been so heavily backed and you kind of liked it anyway.

Whatever it is, you need to get to the cause and driving factor of those decisions.

All of these thoughts are irrational and counter-productive to your punting success. Once you understand what is really driving your poor decisions then you can make a plan for how to change them in the future.

Again, that is 100% within your control and only you can change them.

If you have a problem making marginal bets that you later regret then perhaps the driving force is a psychological fear of missing out on winners. You need to develop strategies to overcome that.

Recognise that the only thing that matters is the bets you make and that marginal bets are very likely to return a small loss over the long-term. Keep records of marginal bets that you either make or develop the discipline to pass and see for yourself. This is something I did for more than 5 years before being completely satisfied that I was better off passing on a bet if something didn’t quite feel right.

Go through this process for all of the decisions you identify that you sometimes make poorly. They may be related to your staking and money management, form analysis process, how you decide when and what price to take… the list can be a long one.

The Decisions you aren't aware of

Even if you feel that your decision making as a punter is solid, there’s a chance you have some holes in your game that you aren’t even aware of.

These come in the form of cognitive biases, which we all possess.

Psychologists Daniel Kahneman, Paul Slovic, and Amos Tversky introduced the concept of psychological, or cognitive bias in the early 1970s. They explained that our decisions may not be as rational or objective as we believe because of biases in the way that we think.

From a punting perspective, these cognitive biases lead to errors in the way that we interpret and process information. While we may think that we are taking all of the relevant information in and making logical, objective decisions, the reality is that our biases can lead to errors in judgement and poor decisions.

There are a number of different cognitive biases that are relevant to punting. Below are what I believe to be the most important and common. Have a read through them with the examples that apply to racing and see if any are relevant to you:

Cognitive Bias Examples
Anchoring Bias: The tendency to rely too heavily, or “anchor”, on one trait or piece of information when making decisions Allowing one factor (e.g barrier, weight, jockey, trainer, wet track stats) to disproportionally influence your assessment of a horse. This can often lead to dismissing a horse’s chance because of a wide draw, big weight, lack of wet track form and so on. Ironically, the factors most often used as anchors are typically among the least important influencers of a horses winning chance and likely betting value.
Belief bias: An effect where someone’s evaluation of the logical strength of an argument is biased by the believability of the conclusion It seems logical that wide barriers are a disadvantage so it must be true. This applies to many theories in punting which seem logical, so the tendency is to believe they must be true. The reality is that more are false than true.
Confirmation bias: The tendency to search for, interpret, focus on and remember information in a way that confirms one’s preconceptions You think that big weight increases for a horse are a key negative, so you tend to notice, focus and remember the examples of those that run poorly, while not balancing it with the facts of those that may have won.
Recency Bias: the phenomenon of a person most easily remembering something that has happened recently, compared to remembering something that may have occurred a while back. The last three odds-on horses have been beaten, so you obviously can’t win backing them. The facts may reveal that prior to that 9 of 10 won and that their overall record shows you can profit from them.
Clustering Illusion: The tendency to overestimate the importance of small runs, streaks, or clusters in large samples of random data. The history of this race says no horse with more than 56kg has won in the last 10 years, so it must be a negative.
Bandwagon effect: The tendency to do (or believe) things because many other people do (or believe) the same A certain horse is written or spoken about as being highly promising because of its last start win, so you believe the same, without assessing the real merit of the performance yourself.
Outcome bias: The tendency to judge a decision by its eventual outcome instead of based on the quality of the decision at the time it was made. “I backed these horses today and lost, so they must have been the wrong horses to back.” The outcome on any given day or short-term sample of events isn’t necessarily reflective of how good your analysis and decision making was (whether it be good or bad.)
Neglect of probability: The tendency to completely disregard probability when making a decision under uncertainty. Believing that a horse at $1.65 should win almost every time, when the reality is, they are only expected to win 6 in 10 races and lose 4 in 10.
Overconfidence effect: Excessive confidence in one’s own answers to questions. For example, for certain types of questions, answers that people rate as “99% certain” turn out to be wrong 40% of the time Believe that your assumptions or judgements about a race or individual horse are almost certainly correct. E.g. Believing a horse can’t handle the wet or run the distance. This is closely tied to the above ‘neglect of probability.’ Regardless of your confidence, the chance of being right with any judgement is only a certain percentage…. and usually less than we think.
Hot hand fallacy: The belief that a person who has experienced success with a random event has a greater chance of further success in additional attempts. Believing that because you are on a big winning run right now that you must be “in-form” and more likely to win during the rest of the day, tomorrow, the next day etc.
Gamblers Fallacy: The tendency to think that future probabilities are altered by past events, when in reality they are unchanged. The classic example of this is thinking such as: “I’ve flipped 6 tails in a row with this coin, so the chance of a head coming up next is much greater than tails”. (the reality is that it’s a 50% chance of each on any flip, regardless of the pattern before.) “I’ve backed ten losers in a row, so I must be getting close to a winner.” (Often used as logic to increase betting stakes.) “We haven’t seen a favourite win at this meeting yet, so one must be due.”

There’s a good chance that one or more of these cognitive biases apply to you. They apply to all of us in varying degrees. The key is to try and be aware of them and work to minimise their negative influence on your punting decisions.

Examine the beliefs and theories you hold about form analysis and punting in general. Ask yourself whether they are really correct? If you actually have the facts to support them?

Remember This

At its core, punting is simply about making good decisions.  You are 100% in control of those decisions and therefore your own punting success. Take the time to reflect on where some of your decision-making weaknesses might be, identify the causes and develop strategies to improve them.

It’s not a one-off task, it’s an ongoing process that as punters we all have to engage in if we want to stay ahead of the game.

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