This is a video from last school year. It's a little goofy, but gives you the idea behind how the Fluency Folders work.
Basically, you will set the timer to count up for the Fry Instant Word List. Record how long it takes your child to read all 100 words. Then you will set the timer for one minute as your child reads the assigned Fluency Passage. This time the counter will count down. He or she will read for one minute, three separate times, trying to improve with fluency and words read per minute each time.
I hope this video is helpful. As always, please let me know if you need ANYTHING. I don't mind sitting down with you to explain the Fluency Folders in greater detail, if they still seem a bit confusing. I hope that you will see what our parents began seeing last year in regards to their child's reading fluency. It made a TREMENDOUS difference. If your child wants extra practice, please encourage it... the more, the better! Remember to make the Fluency Folder fun by turning it into a game/competition. Encourage your child to "beat" his or her previous times! Good luck and thanks for all you do at home to build on what we are learning and practicing each day at school! You're support and encouragement is valued greatly. :)