Z Indexing
Encoders typically use a third signal for Z indexing, which produces a pulse at fixed positions that you can use for precise determination of a reference position. For instance, if the Z index is 45° for an angular encoder, the encoder sends a pulse on the Z input terminal every time the encoder is turned to the 45° mark.
The behavior of signal Z differs with designs. You must refer to the documentation for an encoder to obtain the timing of signal Z in relation to the A and B signals. In NI-DAQmx, you can configure Z indexing with the Z Index Phase attribute/property.