Understanding phono settings

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As far as I know, the only disadvantage in lowering the max. level, which increases the gain of the phone stage, is that the phono input might start to clip when you play an LP with a high modulation (that is, loud music). You can keep an eye on the signal level indicator in the display which should change colour when the input is driven towards clipping. Of course, if it's badly clipped you'll probably hear it too!