nova/ursa ratio

Nova/Ursa Ratio

A sentiment indicator based on the Nova and Ursa funds from the Rydex Fund Group. The Nova fund is bullish with a target beta of 1.5. Whereas, the Ursa fund is bearish with a target beta of -1.0.

The Nova/Ursa ratio is arrived at by dividing the total assets in the Nova fund by the total assets in the Ursa fund. A high value is bullish and a low value is bearish.

Investopedia Commentary

A beta of 1.5 means that Nova has a target of 150% of the S&P 500 Index. Ursa's -1.0 means it has a target performance inverse to the S&P 500 Index. That is, if the S&P 500 is down 10%, Ursa should be up 10%.

Rather than just measuring someone's opinion about market direction, this ratio shows where people are actually putting their money.

See also: Bear, Beta, Bull, Market Sentiment

Also spelled: Nova-Ursa Ratio, Nova Ursa Ratio