Grab it anywhere and pull. Then put it at the top of the stairs and see whether it can be bothered.
It is a chain of rings with springs between them. Each coil is a small body; every neighbouring pair is joined by a soft constraint that sets how far apart they want to sit, and every second pair by a much weaker one. That second set is what stops it behaving like a bit of rope — it gives the coil a faint memory of being straight, which is exactly what a real spring has and a rope does not.
The rainbow is not painted on, it is worked out. Each ring is drawn as an ellipse squashed across whatever direction the coil is travelling at that point, so the coil turns its rings to face you as it bends. The hue comes off the ring's own index.
About the walking, honestly. A real slinky walks because it is a long soft spring on stairs of very nearly the right height, and it is fussy about it — the wrong stairs and a real one just sits there too. This one is given a shove at the top and will usually take the first step or two end over end and then run out of enthusiasm, which is roughly what happens on a carpeted staircase. It is not a perpetual motion machine and it is not pretending to be. Nudge it again.