Gambling Psychology | Dealing With the Ups and Downs
Manipulate your Bankroll / Portfolio
A very simple thing you can do assuming you keep close track of you Betting Bankroll / Crypto Portfolio is to manipulate it in order to decrease the swings mentally. Something I did with the crazy rise in altcoins was to simply multiply my total portfolio worth number x 0.90. During a massive upswing like this, pure emotionally you feel no different when counting 90% of your Portfolio compared to 100% after going up like this. When things correct down on the other hand there is an emotional difference between going down -25% compared to -16%. By seeing the numbers on your screen it's easy to trick your brain and your emotional reaction on the ups and downs. Obviously this can only be done by counting less than you have, anticipating an upswing and writing down more than you have can cause an even bigger emotional backlash when everything keeps going down.
Look at Estimated Profit
Few people really understand variance and how big a sample needs to be to actually say something. You can literally be flipping coins and make huge gains over the course of 1000+ Bets or have very sharp analisis and be down a lot over the course of 1000+ Bets. Being able to estimate what you expect to win based on past performance and adding this into your personal statistics and graph can make you a lot more stable and capable of handling the ups and downs. Being above the expected profit will keep you from dreaming and slacking because you realise your haven't fully earned the profit. Being far below will make you realise that it's just a downswing which will likely regress to the mean. I am always referring to this pink line in my weekly results roundup.
Take Care of Your Health
Big downswings will make you feel like shit and in a mental state where you are very tempted to go for instant feel good fixes like junk food, tv binge watching, gaming or anything else that cheaply triggers the reward center in your brain. This often spirals out of control as all these things make you braindead and decrease the blood flow which is needed in order to use the more advanced regions of your brain (The Prefrontale Cortex). Being shut out of this part will make you much more emotional and highly increases the risk of poor Decision-making,chasing and making the downswing even bigger.
Being mentally, emotionally and physically sharp is a highly important when it comes down to making profit and being able to handle the swings along the way. It is one of those things that can indirectly increase your profitability by a lot. Eating healthy (Plant Based Whole Foods Diet), Drinking mainly water, Take supplements (Omega3,D3, B12), Working Out Daily and Meditation are all tools that you can use in order to be more profitable. Getting to a point where this all comes naturally without the need of discipline can be quite a challenge though.
Stick To Your Plan
Having solid Bankroll Management with a proper plan when moving up or down in stakes helps a lot when it comes down to dealing with the swings. Playing with money that does not influence your life in any way when lost also makes things a lot easier. Just take the time to think about, make and write down your plan and force yourself to stick to it. Once you have something that works, you can blindly put all your trust into it. To quote myself...
"Having this bankroll management for me is extremely liberating and it allows me to just focus on being profitable without having to worry about anything else. I can honestly say that I am looking forward to losing 100k in a single day while using this kind of bankroll management since this would mean that I could actually handle it financially."
Don't Take Things For Granted
We as humans are extremely good when it comes down to taking things for granted. Understanding this process can really do miracles with how you go about your life and your mental mindset. The following thought experiment has really helped me understand and change the overall way I look at things on a daily basis.
Vividly imagine, you are at your work and get a get a phone call from the police saying your house burned down and your wife/husband and child have died in the fire. Completely devastated, you rush home to see your partner and child are fine and it was another house that burned down somewhere. At that moment you are extremely thankful and feel an insane relief that they are still alive while in reality nothing happened. The only thing that actually changed was your brain no longer taking something for granted.
Having this story and idea in the back of your mind instantly makes any downswing you will go through look like a joy and a privilege to be in.
Gambling Psychology | What makes an Expert Gambler ?
thank you for the article @costanza, I was thinking of doing some articles on betting, but I wouldn't like to have them under my own blog as it should be about programming, would you be interested in a partnership ?
Sorry for the late reply,
I'm not looking to overcomplicate things right now to be honest, but I would love to read what you have to say though.
Great points! I personally know people who play poker for a living and one "cost" that does not get factored in nearly enough is the mental health costs of gambling for a living. It might not show up as a number, but being constantly stressed is a high cost that no one should want to pay.
I love how much work you put into your bankroll system and it shows with how thorough and detailed it is. You give an exact, tangible system that people could implement profitably. I'd highly recommend everyone check it out
Indeed, "There are very few people that are equipped financially and psychologically to handle the ups and downs of gambling for a living".
Nearly all long term profitable sports bettors I know use very similar bankroll management.
The main issue for small casual players is that it's actually quite boring, which defeats their purpose. You need to have a lot to win a little instead of having a little to win a lot. This gives the books a huge edge as it's only a matter of time before anyone who plays without proper bankroll management will get wiped out even if they take bets with an expected profit.
Yea I completely agree. The casino has a big edge in that regard. They have an infinite bankroll and cant tilt. A lot of my friends will place their first bet way bigger than they should. Thanks again for your great bankroll management piece
The emotional component of this entire gambling arena is my downfall. No matter what I try, I cannot seem to overcome the greed on the one side and the fear on the other. I like to play around, but that is what keeps me from becoming serious about it in any way.
You're never as good as you think you are when you're winning. And you're never as bad as you feel you are when you're losing... Great post, @costanza!
Exactly ! Well said
I truly enjoy reading your content about sport betting. Also being an individual who does sport bet at times understanding where you're coming from. Even though its hard to follow the rules all the time and the temptation can be a cancer.
I feel like if you have a plan and execute the way you say you do then you can definitely be successful but as humans the emotions play a big part and sometimes that ends up being the downfall.
Indeed, Human nature runs completely contrary to being successful at gambling :)
100% I'm sure many humans see the side affect from it every single day.
Great article man , I think the only thing I would add in terms of mental sharpness is to know when your mental sharpness is. I do most of my trading early in the morning and can maintain focus for at least 2 hours . In the venings I am not so focused so the only thing I will do is put in stop orders so nothing goes array while I sleep.
Great post i have a plan for writing something like that but you create it perfectly with every aspect of it good job
good post i agree with you @costanza
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