An analysis of Zambia lotto: A case study of three playing strategies.

THE UNIVERSITY OF ZAMBIA

SCHOOL OF NATURAL SCIENCES
ACTUARIAL SCIENCE
DEPARTMENT OF MATHEMATICS AND STATISTICS

NAME: JERCY LUMBALA

COMPUTER NO: 2016134529

COURSE: MAT4044

TITLE:An analysis of Zambia lotto: A case study of three playing strategies.

SUPERVISOR: DR. CHOWA

DUE DATE: 25th JANUARY, 2021.

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 An analysis of Zambia lotto: A case study of three playing strategies.

ACKNOWLEDGEMENTS

It is real pleasure to acknowledge those who contributed in one way or another to this research.
To begin with I would like to thank God Almighty who gave me the opportunity and the good
state of mind to write this research report. I would like to thank my lecturers: Mr. A. Banda,
Dr. M. Lombe, and my supervisor Dr. T. Chowa for guidance and assistance in the preparation
of the research report. Without forgetting all the lecturers who contributed in lecturing the
course, I am very thankful.
In addition, I am thankful to my family, course mates and friends for their encouragements and
support over the years. I appreciate their valuable contributions of ideas in the research report.

DEDICATION

This study is dedicated to my mother Mrs. Idah Akobopele Lumbala, my grandmother Emilia
Ekassa, my aunty Magret, my twin Jercene, my sisters Aurelie, Sherrina and Chance and young
brother Gradiel. I also dedicate this to my spiritual father, pastor Emmanuel Fataki. They have
been a great inspiration to this journey of my academic study. They have offered unconditional
love, prayers and support over the years and during the time of this study. With all this, the
predominantly burden of writing this research was made easy.

DECLARATION ON PLAGIARISM

I, Lumbala Jercy (2016134529), student at the University of Zambia pursuing BSc. in Actuarial
Science, do hereby declare that this report represents my own work and that it has not been
presented in any other institution of learning for any academic credit at degree level by any
student from the University of Zambia.

Signature: _______________________________

Date: ___________________________________

COPYRIGHT DECLARATION

All rights reserved. No part of this report may be reproduced, stored in any retrieval system or
transmitted in any form or by any means, photocopying, recording or otherwise without the
prior permission of the author or the University of Zambia.

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 An analysis of Zambia lotto: A case study of three playing strategies.

ABSTRACT

In this study, we investigated three common strategies usually employed by lottery players
which are hot number (high frequency), cold number (low frequency) and random strategies.
The Zambian Lotto was used as a case study. For the three strategies, we considered whether
the selection of numbers specifically the winning numbers follow a discrete uniform
distribution this was to signify if the winning numbers are selected with equal probability. We
also considered whether the performance of the three strategies is significantly the same. It was
discovered that selection of numbers specifically the winning numbers follow a discrete
uniform distribution. Using in sample and out of sample forecasting, it was observed that the
hot number strategy performed better than cold number and random strategy in the year 2020.

Keywords: Lottery strategy, Winning numbers, Cold numbers, hot numbers, discrete uniform
distribution, in sample, out of sample forecasting.

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Table of Contents

ACKNOWLEDGEMENTS ..................................................................................................... 2
DEDICATION ..................................................................................................................... 2
DECLARATION ON PLAGIARISM ........................................................................................ 2
COPYRIGHT DECLARATION ................................................................................................ 2
ABSTRACT ........................................................................................................................ 3
CHAPTER ONE - INTRODUCTION........................................................................................ 6
1.1 Background of the study ..................................................................................................... 6
1.2 Statement of the problem ................................................................................................... 7
1.3 Objective of the study ......................................................................................................... 7
1.3.1 Specific Objectives ................................................................................................................................ 7
1.3.2 Research Questions .............................................................................................................................. 7

1.4 Research hypothesis ........................................................................................................... 7

1.5 Significance of the study ..................................................................................................... 8
1.6 Scope of the study .............................................................................................................. 8
1.7 Definition of the key terms ................................................................................................. 8
1.8 Limitations of the study ...................................................................................................... 9
1.9 Organisation of the study. ................................................................................................... 9

CHAPTER TWO – LITERATURE REVIEW .............................................................................. 9

2.0 Introduction ....................................................................................................................... 9
2.1 Lotto and its funds ............................................................................................................ 10
2.1.1 Lotto’s selection of numbers .............................................................................................................. 10
2.1.2 Distribution of lotto fund .................................................................................................................... 10

2.2 Profile of players .............................................................................................................. 10

2.2.1 The category of people who play ........................................................................................................ 10
2.2.2 What influences the players to play ................................................................................................... 11

2.3 How players choose their winning numbers ...................................................................... 11

2.3.1 Lucky or significant numbers .............................................................................................................. 11
2.3.2 Numbers chosen based on previous winning numbers ...................................................................... 12
2.3.3 Random selection of numbers ............................................................................................................ 12

CHAPTER THREE - METHODOLOGY .................................................................................. 12

3.0 Introduction ..................................................................................................................... 12
3.1 Research Design ............................................................................................................... 12
3.3 Data Collection ................................................................................................................. 13
3.3.1 Primary Data ....................................................................................................................................... 13

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 An analysis of Zambia lotto: A case study of three playing strategies.

3.3.2 Secondary Data ................................................................................................................................... 13

3.4 Data Analysis .................................................................................................................... 13

CHAPTER FOUR – Presentation of Results........................................................................ 14

4.0 Introduction ..................................................................................................................... 14
4.1 Presentation of Results ..................................................................................................... 14
4.2 Discussion of Results......................................................................................................... 18
4.2.1 Hypothesis 1........................................................................................................................................ 18
4.2.2 Hypothesis 2........................................................................................................................................ 18

CHAPTER FIVE – Conclusions and Recommendations ....................................................... 19

5.0 Introduction ..................................................................................................................... 19
5.1 Conclusions ...................................................................................................................... 19
5.2 Recommendations ............................................................................................................ 19
5.3 Areas of Further Research ................................................................................................. 20

REFERENCES ................................................................................................................... 21
APPENDIX I ..................................................................................................................... 23
APPENDIX II .................................................................................................................... 26
APPENDIX III ........................................................................... Error! Bookmark not defined.

List of Table
Table 1: The Results on the monthly Chi-square test on the lottery winning numbers. .................. 14
Table 2: The Results on the half-yearly Chi-square test on the lottery winning numbers. .............. 15
Table 3: In Sample: Results of the less frequent numbers in a month. ............................................ 15
Table 4: In Sample: Results of the most frequent numbers in a month. .......................................... 16
Table 5: In Sample: Results of the less frequent numbers in a month. ............................................ 17
Table 6: Number of Matches in each month and every strategy. ..................................................... 17
Table 7: Out of Sample Forecasting: numbers of matches from the cold numbers. ........................ 24
Table 8: Out of Sample Forecasting: numbers of matches from the hot numbers........................... 25
Table 9: Out of Sample Forecasting: numbers of matches from the random numbers. .................. 25

List of Figures
Figure 1: The distribution of the winning numbers between July and December 2020 ................... 23
Figure 2: The distribution of the winning numbers between July and December 2019 ................... 23
Figure 3: The distribution of the winning numbers between January and June 2020 ...................... 24

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CHAPTER ONE - INTRODUCTION

1.1 Background of the study

Lottery is among the games of chance we have and is being played by so many people. It
involves the giving out of prizes to players who purchase tickets and have corresponding
winning numbers this is according Bradley (2001) and Grundlingh (2004). According to
Simon, (1999) lotto is the most widespread form of lottery. It involves random selection of
numbers. Players in this game randomly choose 𝑥 distinct numbers from a large pool of m
integer numbers. At a certain point, the organizers stop selling the tickets and then select y
winning numbers randomly from the m numbers. If any of the tickets sold match t or more of
the y winning numbers, a prize is given to the holder of the matching ticket. To receive a prize,
t is usually three or more Li, (1999). In this study, we were trying to investigate on the three
common lottery strategies: hot numbers, cold numbers and random strategies, which are
mostly used by players. The Zambia Lotto was used as a case study.
Zambia Lotto has 12 years license to operate lotteries in Zambia and has been operating since
August 22, 2008. Zambia Lotto is in partnership with the international Lotteries Operators and
has more than 400 vending terminals in Zambia. It uses GPRS for online communication
between terminal and central according to Zambia Lotto (www.zambiayp.com).
Zambia Lotto has three lotto games: Mega jackpot, Jackpot and Daily. The selection of
numbers and the pool of numbers differs depending on the lotto game being played by the
player. For Mega jackpot 6/42, Jackpot 6/38 and Daily 5/90.
For the Mega Jackpot and the Jackpot, players can choose 6 out of 42 and 38 numbers
respectively from their tickets in one single entry and 5 numbers out of 90 are chosen from a
ticket in one single entry for the Daily game. The draw machine at the draw time also chooses
6 numbers in the same manner followed by one Extra number (bonus ball). A ticket with 3 or
more corresponding numbers from the draw machine will receive prizes. If there is no winner
then the jackpot rolls over(increases) to the next draw.
The tickets are sold at different prices depending on the lotto game being played. The Mega
Jackpot goes for K7 and the Jackpot for K5. The draws Tuesday, Thursday and Saturday are
for Mega Jackpot and Monday, Wednesday and Friday for the Jackpot. The Draw time is 21:30
on ZNBC TV1 for the Mega Jackpot and on ZNBC TV2 for the Jackpot. The Daily game ticket
costs K3, the draw days are Monday to Saturday and the draw times are 12:00, 13:00, 14:00,
15:00, 16:00, 17:00 and 21:30. Due to technology players do not always have to go to retailers

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to get their tickets but can also use their mobile phone. For now, the facility has only been made
for MTN sim card users only.
Prices are to be collected within 60 days of the draw. No claims after this period are valid.
The Zambian Lotto Jackpot was the focus of this research.

1.2 Statement of the problem

Zambia Lotto has become so popular that is now played in almost all parts of the country. Three
strategies are used and these are hot number strategy, cold number strategy and random
strategy. This research intends to determine if there is a relationship between the different
strategies and the results of weekly draws. It also intends to ascertain how transparent the
Zambian Lotto machine is.

1.3 Aim of the study

The main aim of the research is to find out the best strategy to be used by the Zambian Lotto
players.

1.3.1 Specific Objectives

The study was guided by the following objectives:

1. To determine the distribution frequency of the lotto numbers outcome.
2. To determine a game strategy that outperforms the others based on the history of
the game.

1.3.2 Research Questions

1. What is the distribution of the lotto numbers outcome?

2. Is there a difference in the performance of the three strategies?

1.4 Research hypothesis

1. H0: selection of numbers follows the discrete uniform distribution.

Ha: selection of numbers does not follow the discrete uniform distribution.
2. H0: the performance of the three strategies is significantly the same.
Ha: the performance of the three strategies is significantly different.

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1.5 Significance of the study

This study will be of high importance to the players of the Zambia Lotto as they will understand
which strategy will give a high possibility of winning as they select their numbers. It might
also help create a number generator in predicting the numbers to be drawn on a particular day
through the software being used, which is MS Excel spread sheet modelling. This research will
help to test the transparency of the Zambian Lotto. It will also help risk loving people to
understand if there might be a trend that numbers of the draw follow hence increasing their
awareness. The study can also be of great importance to other researchers who would want to
further a research of a similar topic of discussion.

1.6 Scope of the study

This research is an investigation on the Zambian Lotto and the three common playing
strategies. For data analysis, the information used are the winning numbers from June 2019 to
December 2020. All calculations were done in Microsoft Excel 2019. The results were shown
in tables and figures, with others appearing in appendixes.

1.7 Definition of the key terms

Lottery strategy: the techniques used to play lotto.

Winning numbers: numbers randomly generated by the lotto machine after the organisers
stop selling tickets at the draw time.
Cold numbers: these are numbers that appeared less frequent in previous draws.
Hot numbers: these are numbers that appeared most frequent in previous draws.
Discrete uniform distribution: a symmetric probability distribution where a finite number
of values are equally likely to be observed.
In sample:
Out of sample forecasting:

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 An analysis of Zambia lotto: A case study of three playing strategies.

1.8 Limitations of the study

Several limitations were faced in conducting the research. These limitations comprised of
computation skills, time data constraints, efficiency and effectiveness of the methodology and
time constraints. The prime challenge was, though the information was available, getting the
lotto winning numbers and putting them in the spreadsheet. The other challenge the researcher
had was finding the formula used in simulating the less frequent numbers. This simply means
the researcher had less skill in using Microsoft Excel hence the challenge.

1.9 Organisation of the study.

Chapter One – Introduction: Contains the introduction and the background of the study,
statement of the problem, objective of the study, research hypothesis, significance of the study,
scope of the study, definition of key terms, limitation of the study, organisation of the study.
Chapter Two – Literature Review: explains both the theoretical and the empirical of the study.
It contains different authors each with different opinions as well as news surrounding the topic.
Chapter Three – Methodology: gives details of how the data was collected and the research
design used in the study in order to obtain the results for the study. The winning numbers of
the Zambia Lotto were the main data of interest. This chapter also explains how the data was
analysed.
Chapter Four- Presentation of Results: this contains all the data that was gathered from
chapter three in form of tables and figures for analysis purposes.
Chapter Five – Conclusions and Recommendations: this gives a summary of the research
findings and conclusions for the collected data and analysis. Recommendations are given to
players and future researchers as well as suggestions for areas of future researches were
highlighted as necessary by the researcher.

CHAPTER TWO – LITERATURE REVIEW

2.0 Introduction

This chapter explains how the lotto draws are done and how the numbers are selected. It also
speaks of how the funds gathered from the lottery is distributed. It explains the type of people
who play lotto and what entices them to play more. It finally explains the few different kind of
strategies that players use in the selection of their number combination.

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2.1 Lotto and its funds

2.1.1 Lotto’s selection of numbers

Nowadays, draws for lotteries are done in different ways. For some organizers, the total
selection of numbers is either 5, 6 and so on, but drawing selection of the numbered balls from
the urn without replacement, is the most common thing amongst the organizers. The keno and
Genoese formats were described in Haigh (2004) and Bellhouse (1991) respectively. The rules
for establishing the prize fund and distributing prizes to winners differs depending on the
lottery format.

2.1.2 Distribution of lotto fund

Lotteries are often run by government. They use national lottery revenues for the improvement
of infrastructural facilities and for them to fund civic projects. For example, the California
lottery was created with the purpose to raise supplemental funds for public schools Chen A,
Yang and Chen F (2010). The UK has the Big Lottery Fund which is a non-departmental public
body that distributes 46% of all funds raised by the national lottery for “good causes”. Part of
the good causes are a portion goes to the charity. Diverse range of programmes and projects
are funded by the Big Lottery Fund in the fields of health, education, the environment and
charitable purposes Paine, Taylor and Alcock (2012).

2.2 Profile of players

2.2.1 The category of people who play

The profile of people playing lottery was studied and it was discovered that most people with
low income and low education level contribute greatly to the funds acquired from the lottery
Hennigan (2009). It was also unveiled that; older people buy more tickets than the young ones
do Aasved (2003) and Herring and Bledsoe (1994). It was showed that an increase of 1% of a
country’s education index led to a decrease of about 3% of total lottery sales Faustino, Kaiseler
and Marques, (2009). It was explained through sociological approaches to why poor people
spend more on lottery tickets than the wealthier and better educated peers Beckert and Lutter
(2006). Meanwhile, it was also argued that lottery is associated with increasing social
inequality Freund (2006).

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2.2.2 What influences the players to play

In as much that the probabilities of winning are very low, players are attracted by the huge
amount of money that can be possibly won. For example, the odds of winning the Mega Million
jackpot in the USA is 1 in 175 million and that of the Power jackpot is 1 in 195 million. The
desire to win the jackpot or any other prices has led to players developing strategies that are
different from the traditional selection of numbers in a random way. According to Barboianu
(2009) Some of the developed strategies are the mixture of even and odd number selection,
choosing or avoiding certain numbers, for example consecutive numbers and so on.

2.3 How players choose their winning numbers

Different players have different strategies in determining the winning numbers. Some of these
are; the use of birthdays, the preference of some numbers to others, happiest day and so on. In
this study, we will consider the three commonly used strategies. These are the hot numbers,
cold numbers and the random strategies. The hot number strategy involves the player picking
numbers that have occur most frequently in the previous games to play in the subsequent ones
while in the cold number strategy, players pick numbers that occur less frequent in the history
of the game in order to play the subsequent ones. The random strategy involves the use of
random number generator or any other device that can generate numbers randomly. For this
research, all other form of selection of numbers was categorised as random strategy.

2.3.1 Lucky or significant numbers

It has been observed that players do not choose their combinations randomly and this has been
analysed in a number of papers in the statistics, economics and psychology literature. Some
players choose numbers such as anniversaries and other superstitious numbers. Number 7 is an
example of a number that is traditionally viewed as a lucky number. According to Simon (1998)
{7,14,21,28,35,42} is the most popular combination in the UK National Lottery. This
combination appears tens of thousands of times every week.
It is also observed that players do not choose the same combinations in every draw, some
choose according to events. Several examples are given according to Clotfelter and Cook
(1989, 1991). When Pope John XXIII died, the numbers corresponding to the time and date of
his death and his age was heavily betted on by Italian lottery players. After a popular American

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television series showed a woman betting on a certain number and winning, the following day,
the US lottery operators witnessed a surge of bets on that number.

2.3.2 Numbers chosen based on previous winning numbers

Depending on how frequent the numbers on the lottery winning ticket have come up in previous
draws, some players are influenced by this. For lotto, it is believed that less frequent numbers
in previous draws are more likely to be drawn now. But there are other players who still select
the most frequent numbers in previous draws.
But there is empirical evidence that information on the previous winning numbers does indeed
have both positive and negative impact on subsequent demand for these numbers and
combinations. In German 6/49 lottery according to Henze (1997), it was analysed that the
winning number 8 from the preceding draw was the third most popular combination this was
specifically the Baden-Württemberg lottery. Also, from earlier draws, a total of 269
combinations represented the winning numbers and this was also in the neighbouring countries
of German.

2.3.3 Random selection of numbers

Around Europe and the USA, most lotto games offer a “Quick Pick” option (the name varies),
which allows players to request a random combination to be generated by the lottery terminal
for their ticket. Quick Pick carters about 10% to 20% of tickets sold around the world. Since
the lotto draw is random, some believe that they are more likely to win if they chose their
numbers by a random process Simon (1998). Though some players who decide to use the
random strategy prefer to choose the numbers themselves, rather than the use of the Quick Pick
this according to Simon (1998).

CHAPTER THREE - METHODOLOGY

3.0 Introduction

This chapter explains the methods used to collect and analyse data the Zambian Lotto winning
numbers in order to answer the research questions. It also explains the design used and the
ethics of the research.

3.1 Research Design

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According to Lugya (2010) a research design is a plan that guides the investigator in the
process of collecting, analysing and interpreting observations. For this research, a quantitative
type of research was used. The Zambian Lotto winning were used in order to have the chi
square values and also to obtain the distribution of the winning numbers. Tables were made
to predicted the winning numbers of the following month.

3.3 Data Collection

3.3.1 Primary Data

In Primary data, material on the topic upon which subsequent or studies are based, is anything
from first hand documents for example diaries, interviews to research results generated by
experiments, surveys and the other. Primary data are records of events as they were first
obtained without any interpretation. According to Ajayi (2017), primary data are also set of
data such census statistics, which have been tabulated but not interpreted. It has an advantage
of giving the researcher the opportunity to conduct an unbiased and extensive study on the
research problem set out to solve Ajayi (2017). For this study primary data was not used.

3.3.2 Secondary Data

Restatement or an analysis of primary source of data is secondary source. They often tend to
explain or describe primary data. Primary data are not analysed by secondary source, but some
use them to argue a contention or to persuade the reader to hold a certain opinion Ajayi (2017).
The theoretical framework of this study was obtained from textbooks, articles and the other.
Also, the data used for this research work was of the year 2019 from June to 2020 December
lottery winning numbers of the jackpot draw days which was collected from the Zambian Lotto
website (www.zambiayp.com). All this implies that it was secondary source of data being used.

3.4 Data Analysis

According to Lugya (2010), data analysis involves a process of thorough examination and
interpretation. A process of resolving data into constituent components, to reveal its
characteristic elements and structure. With the information obtained from the Zambian Lotto
website(www.zambiayp.com), the data was analysed using Microsoft Excel 2019 spreadsheet.

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To simulate the high frequency strategy, we found the number of matches of the six winning
numbers including the bonus that have the highest frequency in that particular. To simulate the
random strategy, equivalent to the numbers in each month, random numbers were generated
from the MS Excel 2019 and were recorded and this what is called in sample.

From the information obtained from the in sample, to forecast the low frequency strategy, the
researcher found the number of matches of the six winning numbers including the bonus
number that were in a month and had appeared in the next month. To forecast the high
frequency strategy, we found the number of matches of the six winning numbers including the
bonus number that had the highest frequency of a month and had appeared in the next month.
As example, the frequent numbers in January was used as out of sample forecasting for
February. To forecast the random numbers, from the random numbers obtained from the in
sample, they were compared to the winning numbers data one on one and the numbers of
matches to the winning numbers in the next month were recorded and this is called out of
sample forecasting.

3.5 Research Ethics

In this study, the data used for this research work was of the year 2019 from June to 2020
December lottery winning numbers of the jackpot draw days which was collected from the
Zambian Lotto website (www.zambiayp.com). This implies that the information of the next
winning numbers draws still remains anonymous. The aim and the objective of this study are
explained in simpler terms for easier understanding.

CHAPTER FOUR – Presentation of Results

4.0 Introduction

This chapter presents the finding and the analysis of the collected data of the study. The
findings are in the following order: presentation of results in form of tables and the discussion
of the results obtained.

4.1 Presentation of Results

Table 1: The Results on the monthly Chi-square test on the lottery winning numbers.

Month 2 Statistics p-values

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January 29.18367 0.816692

February 32.71429 0.670208
March 41.37363 0.285516
April 38.14286 0.417259
May 40.53846 0.317069
June 34.03896 0.608621
July 33.06122 0.654282
August 23.83516 0.953739
September 36.36264 0.498729
October 46.38462 0.138648
November 30.51648 0.765486
December 26.34066 0.903820

Table 2: The Results on the half-yearly Chi-square test on the lottery winning numbers.

Semester 2 Statistics p-values .

2019
July to December 39.58571 0.355315
2020
January to June 49.63238 0.080165
2020
July to December 47.50995 0.115451

Table 3: In Sample: Results of the less frequent numbers in a month.

LESS FREQUENT NUMBERS: COLD NUMBERS

WINNING NUMBERS
MONTH 1 2 3 4 5 6 + BONUS

JANUARY 29 31 35 2 38 30 1

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 An analysis of Zambia lotto: A case study of three playing strategies.

FEBRUARY 2 24 21 26 8 38 19
MARCH 8 15 7 9 1 26 32
APRIL 18 9 34 16 8 24 20
MAY 16 15 19 33 37 4 27
JUNE 15 10 6 30 5 3 18
JULY 32 25 4 13 10 30 23
AUGUST 14 6 3 30 3 2 8
SEPTEMBER 6 12 38 15 18 37 4
OCTOBER 16 32 1 10 38 34 1
NOVEMBER 7 16 24 34 35 21 29
DECEMBER 5 20 7 37 11 32 24

Table 4: In Sample: Results of the most frequent numbers in a month.

MOST FREQUENT NUMBERS: HOT NUMBERS

WINNING NUMBERS
MONTH 1 2 3 4 5 6 + BONUS

JANUARY 17 18 4 8 28 23 35
FEBRUARY 29 28 10 8 13 10 26
MARCH 3 36 9 30 32 1 24
APRIL 30 18 25 22 24 36 25
MAY 26 11 26 21 10 19 15
JUNE 36 18 23 10 23 19 4
JULY 34 23 1 17 31 26 24
AUGUST 15 10 26 1 34 23 30
SEPTEMBER 31 14 35 7 25 28 1
OCTOBER 6 1 31 7 19 27 36
NOVEMBER 32 3 20 10 21 32 1
DECEMBER 24 18 9 4 29 16 30

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Table 5: In Sample: Results of the less frequent numbers in a month.

RANDOM NUMBERS
WINNING NUMBERS
MONTH 1 2 3 4 5 6 + BONUS

JANUARY 33 11 16 16 24 16 1
FEBRUARY 23 10 26 19 1 6 15
MARCH 33 14 30 37 37 10 22
APRIL 33 8 32 29 35 10 6
MAY 8 7 22 26 11 31 37
JUNE 1 2 30 26 8 3 30
JULY 13 29 15 21 14 21 5
AUGUST 15 11 29 8 31 26 20
SEPTEMBER 27 36 3 11 20 33 19
OCTOBER 27 25 13 27 9 32 17
NOVEMBER 38 15 29 33 10 37 31
DECEMBER 10 28 6 38 13 25 23

Table 6: Out of Sample Forecasting: Number of Matches in each month

Cold Numbers Hot Numbers Random Numbers

February 5 4 1
March 2 0 2
April 2 2 1
May 0 3 1
June 1 2 1
July 1 3 1
August 1 1 1
September 0 4 1
October 7 4 0
November 5 0 5

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December 2 6 4
TOTAL 26 29 18

4.2 Discussion of Results

4.2.1 Hypothesis 1.

The result of the monthly Chi-square test on the lottery winning numbers is displayed in table
1. Since the p-values are greater than the level of significance which is 0.05, hence we fail to
reject the null hypothesis that the selection of numbers follows the discrete uniform
distribution. This implies that the winning numbers appear to be uniformly distributed every
month.
Apart from using the p-values to draw the conclusion, the 2 test statistics was another

reference. Since the 2 test statistics values are less than 20.05,37 = 52.19232, hence we fail

to reject the null hypothesis.

Table 2 displays the result of the half-yearly Chi-square test on the lottery winning numbers.
Since the p-values are greater than the level of significance which is 0.05 and the 2 test

statistics values are less than 20.05,37 = 52.19232, therefore we fail to reject the null

hypothesis that the selection of numbers follows the discrete uniform distribution. This implies
that the winning numbers appear to be uniformly distributed half yearly too.

The figures 1, 2 and 3 in appendix 1 shows the graphs of how the winning numbers are selected
half yearly. With this, it implies that the Zambian Lotto winning numbers appear to be equally
distributed in their range.

4.2.2 Hypothesis 2.

The result of the monthly in sample of the cold numbers, hot numbers and the random numbers
are displayed in the tables 3, 4 and 5 respectively.
The result of the monthly out of sample forecasting number of matches of the winning number
for the cold numbers, hot numbers and the random numbers are displayed in the tables 7, 8 and
9 respectively in the appendix. Table 6 shows the total number of matches in a particular month
for all the three strategies. The final total number of matches was obtained at the end the of the

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year, and it was seen that the hot number strategy out performed both the cold number and
random strategy.

CHAPTER FIVE – Conclusions and Recommendations

5.0 Introduction

The previous chapters laid a foundation upon which the researcher could draw conclusions and
recommendations. This chapter briefly highlights the major findings, concludes and provides
recommendations based on the output obtained during the research and the data analysis.
From the start, the objectives were
1. To determine the distribution frequency of the lotto numbers outcome.
2. To determine a game strategy that outperforms the others based on the history of the
game.

5.1 Conclusions

From the results, the following conclusions can be drawn:

1. Zambian Lotto winning numbers follow a discrete uniform distribution according to
table 1, table 2 and figure 1 to 3. This implies that the winning numbers are selected
with equal probability. Thus, we can strongly say that the process and machine that the
Zambian Lotto is using in generating winning numbers are not biased.

2. Among the three strategies considered, it was discovered that the hot number (High
frequency) strategy outperformed the Random and the cold number (Low frequency)
strategies. This implies that, players who select popular (high frequent) numbers stand
a better chance of winning higher prizes than those who select unpopular (low frequent)
numbers and those who selected numbers randomly. According to (Sigrid, Claus and Jean
2016), this implies that the players of the Zambian Lotto will tend to be following the ‘hot-
hand fallacy’ (HHF) which means, a particular event is likely to occur because a recent streak
of such events occurred.

5.2 Recommendations

Based on the finding, it has been concluded that the Zambian Lotto in the year 2020, the hot
number strategy outperformed the cold number and the random number strategy. But according

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to Simon (1998), it is believed that mostly the less frequent numbers in previous draws are
more likely to be drawn now, which was not the case for the Zambian Lotto specifically the
Jackpot game. Hence the researcher recommends that a similar research should be done for
the Mega Jackpot of the same year, and observe if the results would be similar. The researcher
also recommends a statistical test in order to confirm the conclusion to the second question
which stated, “Is there a difference in the performance of the three strategies?”, the one-way
analysis of variance can be ideal. Also, on the basis of research literature, theoretical framework
and empirical evidence obtained as a result of this study, other researchers can use it as a
starting point to begin further research on the use of the Internet.

5.3 Areas of Further Research

The study has established that the hot number strategy outperformed the cold number and the
random strategy, hence further research can be done on the Mega Jackpot and the Daily
Zambian Lotto games; since the outcome is a rare one according to other researchers. Further
research can be done knowing whether the selection of numbers by the players also follow a
discrete uniform distribution. This is to mean, to check if the numbers in the ticket are
selected equally by the public. Some further research on proving whether the Zambian Lotto
has a Markov property would be also interesting.

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REFERENCES

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INFAROM Publishing, Applied Mathematics, http://www.infarom.com
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6. Bellhouse, D. R. (1991), “The genoese lottery” Statistical Science 6.

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9. Clotfelter, Charles, and Philip Cook. (1989). Selling Hope: State Lotteries in America.
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10. Clotfelter, Charles, and Philip Cook. (1991). “Lotteries in the Real World,” Journal of
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for lottery schemes, Ph.D. dissertation, Department of Applied Mathematics,
University of Stellenbosch, South Africa, xxv+.

14. Haigh, J. (2004), “Running a lottery, for beginners” +Plus Magazine, Millenium
Mathematics Project, University of Cambridge: Retrieved July 15, 2009, from
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15. Hennigan, G. (2009), LL Bets Are On: Sales highest in neighborhoods with lower
median incomes. McClatchy - Tribune Business News, March, 2009.
16. Henze, N. (1997). “A statistical and probabilistic analysis of popular lottery tickets,”
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17. Herring, M. and Bledsoe, T. (1994), A model of lottery participation: Demographics,
context, and attitudes. Policy Studies Journal, 22.

18. Jonathan Simon. (1998), “An Analysis of the Distribution of combinations chosen by
UK National Lottery Players,” Journal of Risk and Uncertainty, 17:3 243-276.
19. Kevin Dowd, (2002), John Wiley & Sons Ltd, The Atrium, Southern Gate, Chichester,
West Sussex PO19 8SQ, England.
20. Li, P. C. (1999), Some results on lotto designs, Ph.D. dissertation, Dept. of Computer
Science, University of Manitoba, Canada.
21. Lugya, F.K. (2010). Successful resource sharing in academic and research libraries in
Illinois: lessons for developing countries. Unpublished master thesis, University of
Illinois, Urbana-Champaign
22. Paine, A. E., Taylor, R. and Alcock, P. (2012), Wherever there is money there is
influence: Exploring BIG’s impact on the third sector. Research Report, Third Sector
Research Centre, The Big Lottery Fund.
23. Sigrid Suetens, Claus B. Galbo-Jørgensen, Jean-Robert Tyran, Predicting Lotto
Numbers: A Natural Experiment on the Gambler's Fallacy and the Hot-Hand
Fallacy, Journal of the European Economic Association, Volume 14, Issue 3, 1 June
2016, Pages 584–607, https://doi.org/10.1111/jeea.12147
24. Simon, J. (1999), An analysis of distribution of combinations chosen by UK National
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25. Zambia Lotto, www.zambiayp.com

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APPENDIX I

Figure 1: The distribution of the winning numbers between July and December 2020

2020 DISTRIBUTION OF NUMBERS

JULY TO DECEMBER
30

25

20

15

10

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38

Figure 2: The distribution of the winning numbers between July and December 2019

2019 DISTRIBUTION OF NUMBERS

JULY TO DECEMNBER
25

20

15

10

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38

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Figure 3: The distribution of the winning numbers between January and June 2020

2020 DISTRIBUTION OF NUMBERS

JANUARY TO JUNE
25

20

15

10

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38

Table 7: Out of Sample Forecasting: numbers of matches from the cold numbers.

LESS FREQUENT NUMBERS: COLD NUMBERS

WINNING NUMBERS
MONTH 1 2 3 4 5 6 + BONUS

FEBRUARY 2 0 0 1 0 1 1
MARCH 0 0 0 0 2 0 0
APRIL 0 0 1 0 1 0 0
MAY 0 0 0 0 0 0 0
JUNE 0 1 0 0 0 0 0
JULY 0 1 0 0 0 0 0
AUGUST 0 0 1 0 0 0 0
SEPTEMBER 0 0 0 0 0 0 0
OCTOBER 4 0 2 0 0 0 1

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NOVEMBER 0 0 0 3 0 0 2
DECEMBER 0 0 0 0 1 1 0

Table 8: Out of Sample Forecasting: numbers of matches from the hot numbers.

MOST FREQUENT NUMBERS: HOT NUMBERS

WINNING NUMBERS
MONTH 1 2 3 4 5 6 + BONUS

FEBRUARY 1 1 0 1 0 0 1
MARCH 0 0 0 0 0 0 0
APRIL 0 1 0 0 0 1 0
MAY 1 0 1 0 0 0 1
JUNE 0 0 1 0 0 1 0
JULY 0 2 0 0 1 0 0
AUGUST 0 0 0 0 0 1 0
SEPTEMBER 0 1 2 0 1 0 0
OCTOBER 0 0 0 1 0 2 1
NOVEMBER 0 0 0 0 0 0 0
DECEMBER 1 0 1 1 1 1 1

Table 9: Out of Sample Forecasting: numbers of matches from the random numbers.

RANDOM NUMBERS
WINNING NUMBERS
MONTH 1 2 3 4 5 6 + BONUS

FEBRUARY 1 0 0 0 0 0 1
MARCH 1 0 0 0 1 0 1
APRIL 0 0 0 0 0 1 1
MAY 0 1 0 0 0 0 1
JUNE 0 0 0 1 0 0 0
JULY 0 1 0 0 0 0 0

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AUGUST 0 0 0 1 0 0 0
SEPTEMBER 0 0 0 1 0 0 0
OCTOBER 0 0 0 0 0 0 0
NOVEMBER 0 1 1 1 0 2 0
DECEMBER 0 1 0 1 0 2 1

APPENDIX II

The picture below shows how monthly the chi-square statistics (test statistics) and the p-
values were obtained.

The picture below shows how half yearly the chi-square statistics (test statistics) and the p-
values were obtained. It also shows the distribution on the numbers half-yearly.

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The figures below show the in sample and out of sample forecasting for all the strategies.

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The picture below shows how the random numbers were generated.

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