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I'm trying to optimize my virtual machines, so I placed my virtual machines on a separate hard drive. My question is this: Do I also need to put the program installation (VMWare Workstation in my case) on the separate drive as well? Right now all of my programs are running off the OS drive, including VMWare Workstation.

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I'd leave it where it is. I do not think you will get any performance improvement from moving the virtualisation program to another drive. – paradroid May 12 '11 at 23:52
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It won't hurt anything to do so, but you're not likely to gain anything (and almost certainly not anything noticeable) by doing it. For the most part, once a program starts up, it's in memory, and hard drive speed becomes almost entirely moot. This is especially true for performance-conscious applications such as virtualization layers -- they will do their best to avoid the disk I/O bottleneck as much as possible.

I run my VM images from a two-disk RAID0 (striping) array that does little else. My virtualization application (VirtualBox) runs from the same drive as my OS and all my other applications.

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