The Gambler’s Fallacy is the mistaken belief that past random events influence future ones in independent trials. It often manifests in gambling and decision-making.
🎲 The Classic Example
A fair coin is flipped 5 times, landing on heads each time. Many people wrongly believe the next flip is more likely to be tails. In reality, the probability remains 50-50—each flip is independent.
🎰 Casino Pitfall
At a roulette table, if red appears 10 times in a row, gamblers may bet heavily on black, believing it's "due." However, the wheel has no memory—the odds remain the same each spin.
📊 Real-World Impact
- Financial Markets: Investors assume stocks that have dropped must "rebound soon."
- Judicial Decisions: Judges are more likely to deny asylum if they’ve granted several prior cases in a row.
- Sports Streaks: A team that has lost several games isn’t “due” for a win—their next performance depends on skill, not past losses.
🧠 Why We Fall for It
Our brains seek patterns and fairness, leading to the false belief that randomness must "even out" in the short term. But true randomness has no memory.
✅ Key Takeaway
Each event in an independent process stands alone—past outcomes don’t dictate future probabilities. Avoid the Gambler’s Fallacy in decisions!
Want to see the fallacy in action? Try simulating coin flips or roulette spins with code! 🎯