Many people place their bets intuitively. They rely on knowledge or intuition about a particular team or player to make a local assessment of their chances of success. While intuition is reliable in instant development, it doesn’t fit too well with probabilistic judgments, and the Halo effect is one of the reasons why this happens. Read on to learn about the role of the Halo effect in betting decisions.
What is Halo Effect?
Imagine that you have to make your own judgment about the personality traits of two people, let’s call them Alan and Ben, and choose one of them based on the following characteristics:
Alan is characterized by intelligence, efficiency, impulsiveness, a critical look at the world around him, stubbornness and envy. Ben is characterized by envy, stubbornness, criticism, impulsiveness, efficiency and intelligence.
For most people, these descriptions leave a better impression of Alan than Ben. This is an odd estimate, given that their listed characteristics are identical and simply presented in reverse order.
Rather than admitting that the only difference is the order in which the data is received, the lazy side of our mind (often referred to as System 1) seeks consistency in judgment in order to quickly build a coherent judgment.
The initial positive trait – Alan is intelligent – inclines us to interpret the last traits in such a way as to support this point of view, but everything turns out exactly the opposite with the envious Ben. This is called the Halo effect.
What does this have to do with betting? Change the example from fictional people to two football teams or two tennis players, and the list of characteristics to the statistical results of their performances, and it’s easy to see how betting judgments are biased in terms of the order in which the information is given and the metric of specific performances.
This kind of bias is not isolated, people are also susceptible to the availability heuristic, which leads us to give more (and completely disproportionate) meaning to the events or ideas that are easiest to remember. Accessibility is largely related to the strength of our emotional response to events, which is greater when they produce a longer lasting impression, such as high-performance games, five-set tennis matches, etc.
So with the Halo Effect and the availability heuristic in mind, let’s look at some examples in the betting world where they apply.
Brazilian Football Team
The respect that the Brazilian national football team invariably faces sets it apart from all other national teams, and in the minds of bookmakers and the public, it is disproportionate to a truly objective assessment. It is an indisputable fact that the Brazilians won the World Cup more often than any other country, but their five victories fell on two different and already quite distant periods 1958-70 and 1994-2002, while in the last four tournaments they have never been able go beyond the semifinals.
Their periods of success begin with the golden age of Pele, Carlos Alberto, Rivelino and other great players who created the very Halo effect that distorts the perception of all Brazilian national teams. This confirms the presence of bias in their assessment (this is added by emotion thanks to their often broadcast miracle goals, especially from the 1970 tournament in Mexico).
Younger generations may hardly be familiar with the events of more than 40 years ago, but the media perpetuates this idea (confirmation of bias), in fact imposing the idea that all Brazilian players, at least at the level of the national team, are super- qualified. This sequence of evaluations creates a coherent overall judgment: “Brazil has produced many of the most skillful players in the world – therefore all Brazilian players are skillful.”
Interestingly, the fact of their departure from the 2014 World Cup, where as hosts and favorites, they were humiliated in the semi-final 7: 1 by the eventually victorious Germany, may have actually been enough to eradicate this historical halo or, at least cloud it a little.
The Halo Effect also explains why a disproportionate amount of credit is given to famous ex-footballers who transition to coaching. There is no statistical evidence that a good player will necessarily become a good coach. Mark Hughes was a great player for Manchester United and Chelsea, but expectations of him as a coach were subsequently completely disappointed. The halo created by the gaming feats of individual truly great athletes leads many clubs, fans and players to expect more than real from these people when they lead a team. This theme was further developed thanks to the book Moneyball, as well as the film of the same name.
Reverse Halo Effect
The Halo effect can also work in the opposite direction. If the first impression of your resort is a broken sign, it can create a negative context that distorts all subsequent judgments about your stay. In terms of betting, poor initial execution disproportionately skews future estimates.
After the final round of the 2011 US Masters, Northern Irish golfer Rory McIlroy was deemed unpromising by most sports writing media. Before the start of the tournament, he was considered one of the rising stars of this sport, but one tournament that developed dramatically for him (which is easily explained by the confusion of the young golfer) changed this opinion for the worse in the eyes of many experts. But that all changed just two months later when he won the US Open, setting the record for a tournament since 1895, passing the field with a 16 below par. Then in 2012 he won his second major tournament, the PGA Championship.
If these events had happened in reverse order – winning two Majors, and then failing in the final round of the US Masters – the assessments of his future performances would have been more lenient. This is how the reverse Halo effect worked.
Our intuition is a valuable and useful quality, and can often even save our lives by perceiving danger in advance. However, it has many drawbacks when it comes to statistical evaluation. The trick is to get our tense mind (called System 2) into action.
Before choosing a bet, it is important to deliberately seek three counterarguments to your nominal value and use as much objective data as possible with the largest possible sample size, ignoring the mainstream media, which often sow simplistic views and judgments.
Players who read about interesting aspects of psychology, such as the Halo effect, may be inspired to share their new knowledge with friends and colleagues, but this does not mean that they themselves can change their tendency to place bets on athletes or teams with this effect in mind. The point is not whether you’ve learned a new fact, but whether your understanding of the situations you face has changed.