The fu talisman is best understood not as a magic charm in the Western sense but as a document, an order issued within the bureaucracy that Chinese religion imagines the unseen world to be.
An order from the administration
A fu is a Daoist paper charm bearing a written or drawn command, typically brushed in red cinnabar ink on yellow paper in a stylised, often deliberately illegible script that mimics celestial writing. It is understood as a document in the bureaucratic idiom of Chinese religion, an order from the unseen administration carrying the authority of a god or of the priest who issues it, used to summon or command spirits, to heal, and to protect. It may be pasted over a doorway, carried on the body, or burned so that the ash can be swallowed in water as a cure.
Where the power is held to come from
The efficacy of the fu is held to derive from the ordination and registers of the priest and from the correct performance of its writing, not from the paper itself. This locates its power in the same place as all Daoist priestly authority, in ordination and the transmission of registers, and makes the talisman an extension of the office of the priest rather than a free-standing object of power, which is why an identical-looking charm written by someone without the ordination is held to do nothing.