What’s the difference between Custom Groups and Smart Groups?

In EndNote X2, by default the Groups Pane displays when a library is open. Some users are confused by the Custom Groups and the Smart Groups. Here is how they are different:

Custom Groups: manually created groups by the user to help organize his or her library. The user can drag and drop the references into a custom group which can serve as a subset of the library. The custom groups are listed alphabetically.

Smart Groups: created by a user with certain searching criteria to dynamically update groups as existing references are edited and new references are added to the library. It is similar to a canned search.

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