The Rydex Nova/Ursa ratio is a contrary indicator designed to gauge market sentiment among retail investors (Dumb Money). The ratio gets its name from the Rydex Nova and Rydex Ursa mutual funds. Rydex Nova is a bullish fund designed to capture returns corresponding to 150% of the S&P 500's daily movements and Rydex Ursa is a bearish fund created to capture 150% of the inverse of the S&P 500's daily returns. Determining the Rydex Nova/Ursa ratio is as simple as dividing the total assets from the Nova fund by the total assets in the Ursa fund.
