Shared modules folder is one folder you have created to store your existing modules (classes, code modules). In short, what you could use and reuse.
You have to set the path in your IDE to that folder.
Now, when you want to add a reusable module, you choose "Add existing module" and browse to your Shared modules folder and you choose that module. It will be linked to your project but not moved.
If you do a modification to that module in the Shared modules folder, the modification will be in all the projects where you use that module.
If you do a modification to a shared module from the project you are currently working on, that module will be copied into your current project.
Simple and powerful