balanced is when you have both red and black wires actively sending signal.


the ground (usually the black wire in most config/speaker/connection) is carrying the red wire's inverted signal. so both wire are active. this reduces the total harmonic distortion and increases the signal's resistance to inteference. the third pin is the ground reference (which could be left out since the ground is effectively the sum of both wire).

to have the full benefit of balanced setup you need to have the entire chain from the source up till the speaker operating in balanced mode. the amp especially need to be operating in balanced mode driving both the red and black wire actively. balanced config quadruples the power output of an amp.
this could be quite costly to attain and you have to make sure the amp is driving both wire actively since some could only be accepting XLR but summing the signal inside the amp and only driving the red wire leaving the ground channel as ground.

tried such setup during my uni years.