What is the hot hand fallacy?

Believing a streak makes the next success more likely. Sometimes an illusion. Sometimes, awkwardly, real.

For decades the official science said the basketball "hot hand" was pure pattern-hunger, streaks happen in random data too. Then statisticians re-ran the numbers in the 2010s and found a modest real effect after all. The fallacy got a fallacy.

For a bettor the lesson survives either way: streaks make prices overshoot. The crowd pays extra for heat and dumps on cold, so the honest question is "what would this cost if the streak didn't exist?" The distance between that and the live price is somebody's edge.