It doesn't. It'll say the move missed in your chat log, but if you look at your health bar, you certainly take damage, just reduced damage (like any other guard).(which negates the Damage iirc)
When your guard rate w/ capped guard is 5% and with 0 guard is 5%, it's the absolute same chance of preventing death in that situation.i've read that people think that migitating damage, even by the littlest amount don't matter, i think is wrong, how many times has everyone on any job survived by the skin of their teeth after a TP move or just soloing mobs.
That 100 damage hit that killed you at 75 health could have a slight chance of being migitated and help you survive, then heck it's not so bad, every little helps, right?
If you're jamming guard+ into every slot to increase that 5% chance, you're still going to take more damage overall because now you're removing useful defenses, such as PDT gear.