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When I catch a Pokémon or when I select it in the menu I can select an option "TRANSFER"?

What happens when I transfer it to the Professor?

TransferPokemon

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Transfer the Pokémon to the Professor You receive Candy in exchange for transferring a Pokémon. Be careful—you can’t get the Pokémon back after you’ve transferred it to the Professor.

cited from the support page

You receive 1 candy per pokemon transferred, regardless of the pokemon's level of evolution or CP. (Hat tip to @CreativiTimothy) for sharing this in the comments.

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    @h0ch5tr4355 Pokémon Candy is used for increasing the CP of your Pokémon. You need Candy and Stardust to increase the CP. – Linus Juhlin Jul 6 '16 at 21:12
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    @h0ch5tr4355 Haha thanks for sharing that post! Candy is used to power up and evolve your pokemon. The tip is never use your candy on pokemon with fairly low or average cp, since candy is still kinda hard to earn and save :P – Jay Wong Jul 6 '16 at 21:14
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    @EhevuTov exactly, you have Pokemon limit, so maybe you want to transfer the low CP Pokemon which you have more than 2. – Jay Wong Jul 10 '16 at 13:15
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    @EhevuTov hahaha sorry it's just my personal habit. I always want to collect at least two of one kind of Pokemon XD – Jay Wong Jul 10 '16 at 13:19
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    @EhevuTov At least when starting you want to keep at least two because you probably want to evolve one. Also, pokemon with the same name can have different attacks so you might want to keep a few with different attacks. For instance I have a Rattata witih Tackle/Hyperfang and another with Quick Attack/Bodyslam. – Jason Goemaat Jul 18 '16 at 1:00
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Transfering to the Professor is a way of permanently removing a Pokemon from your inventory.

In exchange for a transfer, the Professor will give you some Candies, that can be used to power up and evolve a Pokemon. Note, however, that these Candies are limited to the "family" of Pokemon denoted.

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  • I have only had single candies - but have only transfered "low grade" j – Sobrique Jul 9 '16 at 19:47
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Though implied in the answers so far, it might not be obvious that the purpose of this (in addition to candy) is because you have finite storage space for Pokemon; this allows you to free some up.

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