With vertical editing, you combine multiple stacked layers of one track into a single output. Arranged vertically, a multilayer video track provides the framework for timeline compositing in Smoke or colour grading in Lustre. Vertical editing can only be done between layers; it cannot be done between tracks.
All edits done with vertical editing are soft, so you can modify them at any time. By adding soft effects to your clips, you can create an entire edit without having to leave the timeline or process intermediate results.