This is similar to creating a luma matte from an image with no alpha channel. The transparency information generated from the Alpha option can be used as a matte or stencil for another layer.
Guess—combustion determines the type of alpha channel present in the footage. This option is used when the footage file is first opened.
Inverted Alpha—Inverts the alpha channel. When checked, pixels that were opaque become transparent, and vice versa.
Premultiplied with—Interprets the color channel as premultiplied.
Premultiplied color channels combine the color information with the alpha channel information by using a specific color as a base, almost always white or black. Deselect this option to interpret the alpha channel as a straight alpha channel (that is, a 256-level grayscale image embedded in the file).
Enabling this option helps eliminate a problem that occurs when an image has already been composited over a background with an alpha channel, but then saved with that same alpha.
So if you see a fringe around a composited image, try enabling the Premultiplied option in the Footage operator for that layer.
Note: Make sure to set the Premultiplied color to the color of the fringe. The Guess option also attempts to guess premultiplication.
Color box—Specifies with which color the RGB channel is premultiplied. Click the color box and select a color using the picker.