It lubes the threads. I bought it because my old M3 was really dry and my C3 was kinda gunked up. It's great stuff. I bought the 760G from Lighthound. I think the 760G is closest to what the lights come with from Sure-Fire, so that's what I use.
I've been told it glows in the dark a little bit, but I haven't checked this out myself.
Either that or flouresces (spelling).
The other stuff that Lighthound carries is a little bit thicker I understand..
I'm not sure whether either are conductive, but the 760G appears to be, although if I remember correctly it said it is not in the description on Lighthound's website.
One last thing, I recommend buying the "big" tube. The 50g one. I almost bought the 25g one instead. I was expecting to see this big honking tube in the mailbox, but it's really not that big.