Often it is necessary or desirable to balance the light intensity in one part of a scene with another. This is especially true in situations where you don't have total light control, as in bright contrast landscapes. Exposing for the foreground will produce a washed-out, over-exposed sky while exposing for the sky will leave the foreground dark and under-exposed.
Cokin graduated gray ND filters are part clear, part neutral density. They allow the transition to be blended into the scene, often imperceptibly. A ND.6-to-clear, with a two stop differential, will generally compensate the average bright sky-to-foreground situation and is also the most popular density of the series. 121L - 2X Light starts with the same neutral density as 120, but feathers the grey almost from the color edge and more gently graduates to clear. One stop of compensation. 121M - 4X Medium is the same gentle graduation as 121L but with twice in density. Requires 2 stops of compensation. 121S - 8X Soft is twice the density of 121M and the graduation extends to 3/4 of the filter. Requires 3 stops.