Move up the capo to the third fret. You are now playing in the key of D. Note how much brighter the same chord sounds in this position.
Notice the difference in sound depending on capo position. Determine which one sounds best to you.
Experiment. Play different chords using the capo. Find out the best key for your own vocal range.
Source: How to Use a Capo | eHow.com http://www.ehow.com/how_7022_capo.html#ixzz1HGr7FInx