I have used Traffic Travis and I can`t say how they calculate it but they give you an indicator of how hard they think it would be to rank for a particular keyword. Easy,moderate,very difficult etc.
It must be some kind of algorithm that immediately looks at the top 20 results and calculates all the known serp variables like domain age,backlinks,number of monthly searches, is the domain in Dmoz? Etc Etc Etc
And puts it out as an opinion. Again I am only guessing.