This is a term that’s thrown around, that sounds more complicated than it actually is. It’s the art of setting gains correctly to achieve the best sound quality. Basically by making sure that there’s a fair bit of headroom on all channels, and ultimately the master fader, will ensure a cleaner and less distorted signal.
I tend to aim between -6 and -3 dBFS. As I tend to mix/sum in analogue, this helps to minimise the noise-floor (natural hiss that you get with analogue equipment). If you’re mixing digitally or “in the box” you can get away with a lot more headroom, as there’s no noise-floor to contend with.
The same goes for plugins/outboard equipment, there should be no clipping and plenty of headroom. The level going in should match the level going out, then you can hear what the effect is doing more accurately by flipping the bypass switch.
Again same goes for the master fader. At least 3 dB of headroom is what I aim for. Definitely it should never clip, if it does then bring all the faders down or the master fader input level.
I hope that clears up some of the mystery behind gain staging. Watch the video below for more info