Items play an integral part of any RPG and WoW is no exception. Not only can they improve your character's performance, they also help drive any in-game economy via trading and auctions.
Equipment Rarity
WoW features numerous items and the game conveniently colour codes all of them according to their rarity. This makes it easy for players to determine the relative value of any item in the game simply by looking at the colour of the item's name.
Poor Quality ( Grey )
Common Quality ( White )
Uncommon Quality ( Green )
Rare Quality ( Blue )
Epic Quality ( Purple )
Legendary (No known colour yet)
Artifact (No known colour yet)
Poor Quality (grey) items are also commonly known as "vendor trash" among players and can be sold to the vendor for cash. There are no other uses for them and can be destroyed. Items which are used as components/reagents in a recipe are always marked as Common Quality (White) or better.
What are Bound Items?
Blizzard has introduced a binding system to particular items.
Unbound : These items are not restricted in any way and can be traded freely. Unbound items are not marked with any bound type.
Soulbound : These items are permanently bounded to a player and cannot be traded to anyone else. To get rid of it, you can either sell it to a vendor NPC or destroy it.
Bind on Equip : These items are treated as Unbound when they are first found and picked up and can be traded freely. Once a player has equipped it, it will change status into Soulbound. A warning popup will appear when a player tries to equip such an item.
Bind on Use : As with Bind on Equip items, these items become Soulbound items once you have used it. The difference is trivial, since Bind on Equip refers to equipable items (such as Armor and Weapons) while Bind on Use refers to non-equipable items (such as Pets and Mounts).
Bind on Pickup : An item marked Bind on Pickup will become Soulbound once a player loots it from a NPC corpse in the loot window. This means in a party/group situation, players have to discuss quickly who gets to loot the item in question. A warning popup box will also appear when trying to loot such items.