Kerning, Tracking & Leading
The three basic units of typographic spacing: the space between one specific letter pair, the space applied evenly across a run of letters, and the vertical space between lines.
In practice
These three settings control space in type. Kerning adjusts the gap between one specific pair of letters, such as tightening the A and V in AVENUE. Tracking adds or removes space evenly across a whole word or line, and is often loosened for small capitals. Leading sets the vertical distance between lines of text. In a magazine headline, careful kerning removes awkward gaps, while generous leading makes body text easier to read.
Often confused with letter spacing
Letter-spacing, the name used in web code, is tracking: it spaces all letters evenly and does not adjust individual pairs, which is kerning.
Try this
Type WAVE in large letters, then adjust only the gaps between W and A and between A and V until spacing looks even.