It is kind of a retarded RAM. What it does is that Superfetch puts pages on the stick from where they can be retrieved faster than from a spinning disk (because sticks usually have a faster access time (e.g. 1ms) than spinning disks which are more in the 15ms range).
It really only has an effect if you have a small RAM (512MB or 1GB) and a fast stick. For any RAM 2GB or bigger it makes no sense because there is a certain overhead with Ready Boost that will work against you - it needs to write the pages to the stick and to the disk. ReadyBoost - Wikipedia, the free encyclopedia