You can open the talisman card by lon pressing on any talisman in the game. This card shows several things that need to be addressed to understand how talisman impact the game.
Level: the current talisman level. The higher you level up a talisman, the bigger the stat boost. 1* talisman are limited to level 10, 20 for 2*, etc. up to level 50 for 5*.
Stars: all talisman can drop at several star levels, but all of them can be evolved to a max of 5* as of the time of this writing.
Stats Boost: all talismans give stat boosts, but not all talismans give the same boosts. Every talisman color as 2 or 3 variants that give out different stat boosts. You will find more details about this in the talismans guide put out by Anthony Horton (and hopefully on our site soon enough), but let's just make sure to mention that carefully choosing the talisman variant you're using can make a difference to which stats get boosted and by how much.
Set Effect: This is probably the most important thing about talismans, as well as the most often misunderstood. Each talisman type has a set effect, meaning that when multiple talismans of the same type are equipped together, they give an effect from that set to the character that is wearing them. Some talismans take 2 to form a set, others take 3, still others take 4, and the most powerful effects come from sets of 6. As a general rule, the more talismans it takes to make a set, the stronger the effect. The effect can be a stat bonus (ATK + 15%), a passive effect (give a shield for 2 turns at the start of battle), or an actual usable skill (rage lance, ice spear).
Talisman sets are one of the most powerful tools in the game when selected properly. Taking the time to understand how they work, locating your favorite effects, and knowing how, when and where to get those talisman sets is key to achieving top tier status in the game.