The Lens Flare effect simulates the refraction caused by shining a bright light into the camera lens. Specify a location for the center of the flare by clicking anywhere inside the image thumbnail or by dragging its cross hair.
This effect works with 8-bpc color.

Harry Frank has a good tutorial on using the Lens Flare effect together with Trapcode Shine and shape layers:
http://www.graymachine.com/tutorials/lensflare.html
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