これ is the direct equivalent of 'this' in English. It is always used to refer to something in the speaker's immediate vicinity, whether that proximity is physical or emotional.

• 友情(ゆうじょう)。これは大事(だいじ)だ。
  Friendship. This is precious. (Emotionally close)
• これも私(わたし)の？
  This is mine too? (Physically close)
• これは本(ほん)です。
  This is a book. (Physically close)

Although it's translated as a 'pronoun', thinking of これ as a substitute noun (which is closer to its literal Japanese meaning) can be useful. It always serves to replace a noun that is either unknown to the speaker or doesn't need to be explicitly mentioned.

• これはジュースです。これはおいしいです。
  This is juice. It's delicious. (これ acts like 'it' in English, in the second sentence)