There is no need to remove your sd card.When you had reset your phone you are simply opening up the recovery screen where you have 5 options.
Reboot now-this simply starts up your phone like when you push the power button
Apply update from sd card-
This is only for advanced users.
Factory reset- this deletes all user data on your phone. None of the data on your sd card is erased.
Wipe cache partition- this cleans out your cache partition
Test redband fotal- advanced users only.
There is usually no need to hard reset unless your phone is frozen, you are flashing a custom rom (advanced) or you are selling the phone and want to factory reset (this can be done through the settings too)