Baccarat is a game of chance. The rules are simple: players bet on the player or banker, whose hand total is closest to nine. A winning bet is paid out and the game ends. The game’s popularity has increased worldwide since its resurgence in Asia and now it is available to US gamblers online as well as in brick and mortar casinos. It is the biggest card game in the world with a long history that started in Europe and spread through Asia before finding new life in the United States.
In a typical baccarat table, there are from seven to 14 seats for players and one area for the dealer. A croupier deals the cards, and the winner is determined by the hand with the closest value to nine. In addition to betting on the player win or banker win, players can also make side bets on a player pair and a banker pair. These side bets have higher risk and are only available in some baccarat variants.
Our research finds that baccarat gamblers consistently exhibit positive recency, but not negative recency or gambler’s fallacy. It seems more plausible that baccarat gamblers’ adherence to following trends is driven by the fact that they believe that the probability of an outcome fluctuates over time, and that these fluctuations are governed by some hidden Markov process (e.g., a hidden Markov chain), and that the interruption of an outcome streak signals that the probability has shifted.
Furthermore, baccarat gamblers seem to be aware of this tendency to follow trends; however, they may not be fully conscious of the fact that their decision-making is affected by it. This is supported by the observation that baccarat gamblers who were explicitly reminded of their tendencies to follow trends decreased their wagers on the player or banker win, but not on the tie.
It is also possible that a number of social and environmental factors unique to baccarat influence betting patterns, such as the presence of other players at the same table or the highly stimulating casino environment. It is therefore important that future studies examine the role of these factors in baccarat. These studies should use cognitive modeling approaches to better understand the mechanisms underlying positive recency in baccarat, and in other types of gambling games as well. In particular, such experiments should consider the role of social and environmental influences that are typically ignored in laboratory-based experiments. In this way, future work can identify the specific elements that lead to a preference for betting in accordance with the current trend in baccarat. This will provide a more accurate understanding of the nature of positive recency and help explain why it is so prevalent among baccarat gamblers.