The Magnetic option changes the Freeform Pen tool into a magnetic vector drawing tool. For example, selecting the Magnetic option forces the tool to follow the visible edge of an object in the document window. The Magnetic option instructs the Freeform Pen tool to key to the shift in brightness between an object and its background. It's a great way to make a difficult path. Once you click to define the starting point, it's not necessary to hold down the mouse, just move while closely following the visible edge of the image. If you get to a tricky point where the Magnetic lasso doesn't know what to do, just click your mouse to add a user-defined anchor point.
Freeform Pen tool on the toolbox.
Magnetic check box on the Options bar.
IMPORTANT
When using the Magnetic option with the Freeform Pen tool, you cannot create an open shape.
Shape Layers or
Paths button.
Freeform Pen tool over the edge of a shape, and then click and release the mouse.
The magnetic option helps you stay on the edge.