Damping of slow oscillations with active and reactive power modulation of high-voltage direct current (HVDC)-links is analyzed with the aim of gaining a physical insight into the problem. The analysis shows that active power modulation is efficient when applied a short mass-scaled electrical distance from one of the swinging machines, and reactive power modulation is most efficient when a well-defined power flow direction exists and the modulation is made at a point close to the electrical midpoint between the swinging machines. It is shown that the intuitively appealing feedback signal frequency and derivative of the voltage are appropriate for active and reactive power modulation. The impact of the constraints imposed by the HVDC equations is analyzed, and it is determined when the implicit reactive power modulation resulting from constant gamma control may be detrimental for the damping. >