Another quick helper for people coming from the #TwitterMigration (slightly overly simplified).

Feeds:

Home = people you specifically follow, no matter what instance they "live" on

Local = the feed for the people across the same instance you're on, whether or not you follow them

Federated = public posts from people "known" to your instance, ie people on the same instance as you OR people followed by people on your instance, like a 2nd degree connection (it is NOT "every user on Mastodon).