Warning: due to recent demands for AMD cards for non gaming purposes, they are hard to find at normal prices.
Choosing a GPU is fairly simple compared to other parts, while they are the hardest to understand when it comes to knowing why they perform well compared to each other. The gaming oriented lines from each company is the Nvidia Geforce GTX series, and the AMD Radeon HD series.
1) Performance
The primary cards worth purchasing from either Nvidia or AMD are generally going to be priced at $100 and above. As prices drop below $100 the performance tends do drop of exponentially so we will be ignoring that category all together. Within each brand the numbering shows performance levels, For example an HD R9-270x is better than a R9-280x and a Geforce 770 is better than a Geforce 760. Between brands comparing performance is difficult without checking benchmarks. The good news is that competition quickly insures that pricing is appropriate so you will generally get what you pay for. If two card's are priced at 200 dollars they may not perform the same, but they will perform somewhat close.
Note: In addition to numbering Nvidia uses "ti" and "ti boost" suffixes, unlike manufacturer upgrades (such as OC or Superclocked) these suffixes denote completely different models and represent a significant performance change
VRAM is another important feature of a video card, however for the most part you don't need to worry about this. 1GB of VRAM is enough for most lower end cards and 2GB of VRAM wont offer as much of a performance upgrade as just choosing a higher end model will.
Note: Avoid cards with DDR3 VRAM, it should be GDDR5.
2) Other features
When you start looking for your video card you will probably quickly notice that for any given model (such as a GTX 760) that a large number of variants exist, with many different prices. The primary difference between these comes down to their clock speed and their cooling method. the more expensive variants will generally employ a better cooler, and as such ship with a higher speed. This speed change is very little compared to the speed change from going up a model however. The other change is that the better cooling units will generally be quieter than the cheap versions of the same model of the card.
3) Choosing the video card
Actually choosing what you get is going to depend on your budget and your expectations
Cards in the low 100's range such as the R7-260x, and the GTX 650ti will be able to run most games at acceptable settings, but won't be enough to max many newer high demand games
Cards in the upper 100's such as the R9-270x and GTX 650ti boost will be better able to run more games on high and max.
Cards 250 and above such as the GTX 760 and R9-280x will be even more powerful, maxing almost all games even with higher levels of MSAA
Cards 350 and above such as the R9-290 and the GTX 770 are often more powerful than what is needed for standard 1080p gameplay, these are ideal for larger resolutions such as 1440p, Multi monitor gameplay, and 3d monitors
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