Have you ever experienced the feeling of being on a roll? Where everything you touch turns to gold? You might have even convinced yourself that athletes and sports stars are the same and that once they’ve won a couple of times, that they’re a certainty to win again. However, evidence suggests that this Hot Hand effect is overstated and mostly down to luck. What does this mean for your betting and how can you factor this into your own analysis?
What is the Hot Hand effect?
The term Hot Hand comes from basketball, where the prevailing thinking was that a player who scores several shots in a row will be more likely to score on their next shot. Everyone from coaches, fans, and commentators to the athletes themselves become convinced of the power of this effect. However, various studies have shown that the Hot Hand effect is less likely to determine an outcome than pure random chance.
Studies on other sports such as baseball also show very little effects of any statistical significance. From looking at batting streaks to the winning sequences of teams, eventually we tend to see these winning streaks ending and teams and players reverting back to their average performances.
So, if the effect doesn’t really exist or is only a weak one at best, then why do we place such importance on it? Part of the reason is evolutionary. From our hunter-gatherer days, we have been hard-wired to look for patterns in our environment - food sources, water, and animals tended to be clumped together, and this is shown within betting, to ensure we get the maximum from any trends we see in the market.
Another reason is that because it happens to us, we assume the same occurs for a highly tuned athlete. However, evidence from junior golfers (Cotton and Price, 2006) shows that the higher the skill level and experience that an athlete has, the less susceptible they are to the effects of confidence and self-belief.
We also have a cognitive bias where we suffer from presentism, or the feeling that the current conditions will last for longer than they should in reality.
Exceptions to the Hot Hand effect
There are some situations where the Hot Hand effect does make a difference:
- Analysis of ten pin bowlers showed that they were approximately 12% more likely to hit a fifth strike if they had previously got four in succession (Dorsey-Palmateer and Smith, 2004).
- At the hardest shot contest in the NHL, statisticians found a near-perfect correlation between the shot speeds of players (Reifman, 2007).
- Tennis servers were more likely to win their next point if they had won the previous one (Klaasen and Magnus, 2001).
However, all of these share the trait of being fairly repetitive motions with a short delay between actions. Other skill-based competitions such as the 3-point competition at the annual NBA All Star game might also be worth looking at, but when the number of variables in a sporting contest increases (e.g. other players, game conditions, the effect of a crowd etc.) then it’s much harder to notice the Hot Hand effect.
How can the Hot Hand effect impact your betting?
The Hot Hand effect might suggest that media commentators influence casual bettors in the betting market by highlighting players or teams on incredible winning runs (or the opposite, with an overly skewed Cold Hand). Prices on teams may be overly exaggerated or underestimated, suggesting there is value to be found in a contrarian approach and going against current trends.
It is important to be able to identify overperformance or underperformance in a team or individual.
Studies in this area have also shown that players adjust their strategies if they are consciously aware of being on a positive streak, and other teams may react differently to this player and double up on them, making it even harder for a player to replicate their earlier form.
Knowing when a team is vastly overperforming or underperforming based on your own objective assessment can be a lucrative strategy. Applying context to a streaky run, such as the opponents faced and the game state, will also add another layer of analysis that some other bettors may have missed. It’s not guaranteed to work every time, but as the saying goes, all good things must come to an end.
If you are interested in learning more about the Hot Hand effect, here are some recommendations:
- Hot Hand: The Statistics Behind Sports’ Greatest Streaks - Alan Reifman.
- The Hot Hand: The Mystery and Science of Streaks - Ben Cohen.
- The Hot Hand in Basketball: On the Misperception of Random Sequences - the seminal research paper that inspired this field of study by Gilovich, Vallone, and Tversky.