Analyzing the Impact of USADA on Underdogs

In a recent post about the effects of USADA testing, veteran blogger Zach Arnold included the following passage:

If you follow MMA betting wizard Luca Fury on Twitter, you know that the game has changed for real since the implementation of USADA’s drug testing program. Since the implementation of USADA testing, it is now smarter and more profitable to side with the underdogs than the favorites. You used to hit on an occasional 3-to-1 underdog here and there but now your chances of making money simply with underdogs is greater than ever before. It’s not a coincidence. When you have a sport with doping problems comparable to horse racing, any threat of out-of-competition drug testing immediately creates more randomness for success in a sport that was already way more random and harder to predict than other sports to bet on.
— http://www.fightopinion.com/2016/03/28/usada-ufc-drug-testing-out-of-competition/

At first glance the thought seems somewhat logical. Fighters who were once juiced the gills are now being forced to compete without previous advantages. If lines are constructed based on past performance, there should be many opportunities for upsets. Does the data bear this out?

The short answer is no. Per MMAJunkie, USADA testing in the UFC began on July 1, 2015. If Arnold and Fury’s theory is correct, we should see drastic changes in the winning percentages of underdogs when we compared the first six months of 2015 with the second half of the year. For the purpose of this exercise, an underdog is defined as any fighter with betting odds above one (eg +100). Draws and no contests are excluded. Closing odds from 5Dimes from the BestFightOdds.com database were used.

In the first half of 2015, underdogs went 85-140 (38 percent). In the second half of the year, they went 85-142 (37 percent). You do not need to be a statistician or Mike Goldberg to see that those numbers are virtually identical. Given these numbers it would be hard to argue that USADA testing had any effect of the success of underdogs. 

Per USADA, the focus of the first three months was "education" and the group did not start whereabouts tracking until Oct. 1. Let's throw out the data for between July and October and focus on the six-month period from Oct. 1 to March 31. During that period, underdogs went 83-121 (41 percent) which is a slight, but not necessarily significant, improvement over the six months prior to any testing.

However, to be fair, the citation actually uses the example of a 3 to 1 underdog. It is possible that under the new system, larger underdogs are being more successful while ones in the +100 and +200 range are performing similar or worse. This is also not the case. The following chart shows a breakdown of winning percentage for underdogs based on their betting odds. As you can see, the winning percentage of betting underdogs has remained relatively constant or decline in almost every odds range.

These findings are not an indictment of USADA testing. If anything, the results should be considered praise for bookmakers. Betting odds are not created in a vacuum, and they are not based solely on past performance. The people who create the odds follow the sport, watch the weigh ins and such just like bettors. It is extremely unlikely that throwing money down on random upsets will result in profit even in a post USADA world. Instead, consider taking the advice of the @NakedGambling.