Are You Thinking in Bets?

Annie Duke, a former professional poker champion and decision strategist, argues that life is more like poker than chess—it’s full of incomplete information, randomness, and unknowns. Therefore, we must learn to make decisions like elite poker players do: by focusing on the quality of the decision process—not just the outcome.

My Key Learnings From The Book:

1. Embrace Uncertainty – Life is a Bet

“What makes a decision great is not that it has a great outcome. A great decision is the result of a good process.”

• Every decision is a bet on an uncertain future.
• Thinking in bets trains you to accept uncertainty instead of chasing false certainty.
• Let go of the idea that “right = smart” and “wrong = dumb.”

2. Resulting: Don’t Judge Decisions by Outcomes

Resulting is a disease in our decision-making culture.

• People wrongly judge decisions solely by outcomes:
  • Good outcome = good decision? No.
  • Bad outcome = bad decision? No.
• Great decisions can have bad outcomes due to luck—and vice versa.
• Focus on decision quality, not just results.

3. Separate Luck from Skill

“Outcome quality ≠ Decision quality”

• In investing, business, and relationships—luck often interferes with outcomes.
• Ask: “Was this decision repeatable?” or “Was I just lucky?”
• Track decision-making processes like a scientist, not a gambler.

4. Think in Probabilities, Not Certainties

“Nothing is 100% or 0%. Everything lies somewhere in between.”

• Stop thinking in binary: right/wrong, win/lose.
• Replace with:
  • “I’m 70% confident this will work”
  • “There’s a 40% chance of rain”
• Probabilistic thinking makes better, more flexible decisions.

5. Use Truth-Seeking Groups

We are betting all the time. We just don’t always realize it.

• Surround yourself with people who challenge your ideas constructively.
• Create a “decision pod”:
  • Encourage dissent
  • Reward honest disagreement
  • Disarm defensiveness

6. Time-Travel Your Thinking

Don't equate the quality of a decision with the quality of its outcome.

• Ask:
  • “What will I think about this decision in 1 year?”
  • “If this fails, what might I regret not considering?”
• Future-regret minimization helps you act rationally today.

7. Pre-Mortem and Backcasting

“What are the ways this can go wrong?”

• Pre-mortem: Imagine your plan failed—why?
• Backcasting: Start with success—what steps did you take to get there?
• Both strategies build resilience and reduce surprises.

8. Calibrate Confidence

Confidence should match the likelihood of being correct.

• Keep score of your predictions and judgments.
• Align your confidence with real accuracy over time.
• Learn like a forecaster, not a fortune teller.

9. Accountability and Decision Journals

Improving decision quality is about being less wrong over time.

• Track your thinking before outcomes are known.
• Write down:
  • Your assumptions
  • Confidence level
  • Alternative paths considered
• Review later to de-bias and improve your decision process.

Who Should Read This Book?

Samridh's Library recommends this book for:

• Investors, entrepreneurs, and leaders who face high-stakes, uncertain decisions
• Students of behavioural finance, psychology, game theory
• Anyone looking to separate luck from logic and get better over time

A Samridh’s Library Checklist of Habits from Thinking in Bets by Annie Duke

“A bet is a decision about an uncertain future. So is life.”

A. Process-Oriented Habits:

1. Treat Every Decision as a Bet
   • Ask: “What am I really betting on here?”
   • State your decision as a probability (e.g., “There’s a 70% chance this will succeed”).
2. Detach Outcomes from Self-Worth
   • Don’t say “I was wrong” = “I’m stupid”
   • Instead, say: “That was a bad result, but was the decision process sound?”
3. Say “I don’t know” More Often
   • It’s not weakness—it’s intellectual honesty.
   • Make curiosity your default mode.

B. Thinking Habits

4. Avoid ‘Resulting’
   • Don’t judge a decision only by its outcome.
   • Pause and ask: “Was this a good decision—even if it ended badly?”
5. Use Probabilistic Language
   • Speak in percentages: “I’m 60% confident this will work.”
   • Replace yes/no thinking with range-based confidence.
6. Run Pre-Mortems and Backcasts
   • Before acting, ask:
     • “If this fails, what could cause it?”
     • “If this succeeds, what helped it work?”

C. Decision Tracking Habits:

7. Keep a Decision Journal
   • Before making big decisions, write:
     • What am I betting on?
     • How confident am I?
     • What else did I consider?
   • Review it after 1 week, 1 month, or 1 year.
8. Grade Yourself on Process, Not Outcomes
   • Set weekly reflection time:
     • “What did I decide well, regardless of how it turned out?”
9. Calibrate Your Confidence
   • Track how accurate your predictions were vs. how confident you were.
   • Aim for your confidence to match your accuracy.

D. Social Truth-Seeking Habits

10. Form a Truth-Seeking Pod

• Find a group of friends/peers who challenge your thinking respectfully.
• Reward dissent and avoid echo chambers.

11. Ask Better Questions

• Instead of: “Was this right?”
• Ask: “What assumptions did I make?” or “What evidence might change my mind?”

12. Practice Time Travel

• Future-you check-in:
  • “How will I view this decision in a year?”
  • “Will I wish I’d waited or acted differently?”

Final Thought:

A great decision is the result of a great process—not a great outcome.

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