It designates the selected vertex as the center and moves together with the neighboring vertices as if they are attracted by the magnet.
It sets up how a magnet works.
It shows three arrows along with X/Y/Z axes, and you can move along with X/Y/Z axes with dragging.
When you 
click the top of the arrow (red, green or blue part), you can input an amount to move.
When you drag the handle with Ctrl key and Shift key, you can change the direction of the handle. And you can input a rotation angle by clicking a red, green, blue or cyan ring.
It sets up how far magnet has an influence by dragging from the selected point.