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Best practice is to keep the master volume out of the yellow/red, but it’s important to understand that when we talk about “32-bit Floating point” you can actually push you volume louder, then turn it down after.
Some synths will distort if it shows red, so this is bad.
If you turn it up loud, and there’s no distortion, you can turn down your volume on a mixer fader that your virtual instrument is routed to.
When it comes to hardware recording, we have a fixed volume, so red is bad, and yellow is to be very cautious that you may distort.
When you’re ITB (in the box), we don’t always have to play by those rules – and it’s typically a “by ear thing”.. if it’s distorting, then pull back on the master volume of your virtual synth there!