Proxy icon is the small icon next to the document title in a document-based app such as Finder, TextEdit, Preview, Pages etc. It will appear after a new document has been saved. Click and hold the icon for a few seconds and you can start to drag it. Drag and drop the proxy icon to another application window to open the document in that application. When you drag the proxy icon to the Finder/Desktop, a shortcut to the document will be created. Press the Option key while you drag to the Finder will allow you to make a copy of the document.