A new study from the American Gaming Association (AGA) suggests that users of prediction markets may overestimate their mathematical abilities, despite demonstrating confidence in their numerical skills. The findings also indicate that gamblers, on average, display greater financial literacy than people who do not gamble.

The AGA, a trade association representing the casino and sports betting industries that has strongly opposed prediction markets, does not explicitly characterize prediction market users as mathematically deficient. Instead, the organization highlights a gap between their perceived abilities and their performance on objective assessments.

“Prediction market users are more likely to misjudge their mathematical ability,” the industry group reported. “Sports bettors show the greatest mathematical confidence and objective capability, meanwhile ‘prediction market’ users expressed nearly as much confidence in their mathematical skills but performed more in-line with non-gamblers when those skills were objectively tested.”

The study included 3,149 participants: 537 sports bettors, 574 prediction market users, 557 casino players, 495 iGaming users, and 986 people who did not gamble.

AGA Study Finds Higher Financial Literacy Among Gamblers

One potentially unexpected finding is that people who gamble scored higher on financial literacy assessments than non-gamblers.

“Gamblers scored an average of 3.93 out of five on a widely used financial literacy index, compared with 3.72 among non-gamblers, a statistically significant difference,” the study found. “41% of gamblers qualified as highly financially literate, compared with 27% of non-gamblers.”

However, these results contrast with other research suggesting that frequent sports bettors who lose money can experience deteriorating credit scores and increasing financial delinquencies.

Financial industry commentary and research have also raised concerns that some younger consumers are prioritizing sports wagering and prediction market trading over building investment portfolios, including retirement savings. Critics could argue that these behaviors are difficult to reconcile with strong financial decision-making.

The AGA study does not distinguish which specific gambling groups—such as casino table game players, slot machine users, poker players, or sports bettors—demonstrate the highest levels of financial literacy.

Financial Knowledge May Encourage Responsible Gambling

The research also identifies a relationship between financial literacy and responsible gambling behavior. This suggests that consumers with a stronger understanding of financial risks may be better equipped to recognize gambling’s limitations as a financial strategy and distinguish it from long-term investing.

“Participants with moderate or high financial literacy recorded significantly higher Positive Play scores than those with low financial literacy,” the AGA noted. “The findings suggest that financial literacy education may strengthen responsible gaming resources by helping consumers better understand risk.”

The association does not necessarily establish that financial literacy directly causes more responsible gambling behavior. Other factors may also influence how people approach wagering and manage risk.

Nevertheless, the findings suggest that financial education could complement existing responsible gambling initiatives by helping consumers make more informed decisions about their betting activity.

Among the different gambling categories examined, the AGA identified casino players as the most responsible group.