It is impossible to understand our place in reality without considering the reality's four planes of existence. Understanding them provides the framework for understanding the magical realm of Faerie, the realm of ghosts and other spirits, the realm of daemons, and - most importantly for wand lore - the astral plane that is composed of pure Quintessence, the magical material from which magic spells are crafted.
The Four Planes of Existence
As shown above, reality consists of four planes of existence, stacked on top of each other:
Astral Plane of Existence - The highest plane of existence, the astral plane is an endless void filled with a golden fog of Quintessence, the magical material from which spells are made.
Spiritual Plane of Existence - Lying between the astral plane and our physical plane, the spiritual plane is the realm of ghosts and other spirits such as poltergeists, dryads (tree spirits), naiads (water spirits), sylphs (air spirits), and wisps (fire spirits).
Although non-corporeal and normally invisible when in the physical plane, spirits can - if they so desire - briefly show themselves and communicate with people and magical beings such as fairies and mermaids. Mages can also make spirits visible by casting the appropriate spells.
Physical Plane of Existence - This plane contains both the mundane natural non-magical world, which is the home of humanity, and Faerie, the original home of magical beings and beasts.
Daemonic Plane of Existence - Lying below our physical plane of existence, the daemonic plane is the dark realm of daemons.
Portals are places where our mundane world and Faerie nearly touch and the barriers between them are weakest. At certain times of the year, these barriers almost cease to exist and it is relatively easy to move back and forth between them. It is during these times when magical creatures sometimes slip through the portals and into our world. Fortunately, we do not need to wait for these dates in order to cross into and out of Faerie. We can cast special spells to travel to Faerie any time we want.
Similarly, there are places where the spiritual and physical planes nearly touch and spirits and ghosts may easily visit our world and Faerie. Magic spells can be used to summon and banish spirits. Finally, there are places where the physical plane and the daemonic plane nearly touch. Daemons occasionally break into our physical plane and can cause great harm until they can be killed or sent back to where they came from. Specifically, greater daemons commit evil acts such as murder and arson whereas the lessor daemons make all manner of annoying mischief.