Edge stitch is a stitch along the edge that is either just to “frame” a pattern stitch or it could be used to sew the thing up. Did the pattern tell you what they wanted you to do for the edge stitch somewhere else? If not it could be a knit on the right side, purl on the wrong side if it is sewn up. It might be a knit on either side or it could be something like knit the last stitch of each row and slip the first stitch (like for a scarf).
K2tog is a decrease and will get rid of 1 stitch. But the yf (yarn forward) is an increase that evens things out. Yf is a yarn over in American terms (most of the time, and in this case). It is shown in the list of increases, I’m sure, on the video pages. (See the bar above for a drop down menu).
A yarn over is something that is done between stitches. In this case all you do is to bring the yarn to the front between the needle tips like you would if you were going to purl the next stitch. From that position you do the K2tog. This will cause an extra strand to be formed over the needle that is the yo inc. On the next row you treat it as a stitch.