Wrong, here's a post I made on another thread that explains this.
In the alphabet there is 26 letters. Therefore a 3 letter has 26 x 26 x26 possible combinations for a total of 17576 combinations. A 3 character like NL8, has 26 letters for the first digit then 26 again for the second and then 10 for the final digit. So 26 x 26 x 10 = 6760 possible cobinations, or maybe it's a tag like H71 which is 26 x 10 x 10 = 2600 possible combinations (26 letters, 10 numbers, and 10 numbers).
3 Letter (HBA) = 26 x 26 x 26 = 17576 Possible Combinations
3 Character (NL8) = 26 x 26 x 10 = 6760 Possible Combinations
3 Character (H71) = 26 x 10 x 10 = 2600 Possible Combinations
TL;DR There's less numbers then letters therefore 3 characters should have the higher value on paper.