Virtual machines may run in one of two main modes, paravirtualized (PVM) or hardware virtualized (HVM). In paravirtualized mode, the kernel of the guest operating system is recompiled to be made aware of the virtual environment. This allows the paravirtualized guest to run at near native speed, since most memory, disk and network accesses are optimized for maximum performance.
If support for hardware virtualization is available (either Intel VT or AMD-V), the guest operating system may run completely unmodified. This hardware virtualized guest is carefully monitored and trapped by Oracle VM Server when any instruction is executed which would violate the isolation with other guests or dom0. In the current implementation, there may be performance penalty for certain types of guests and access types, but hardware virtualization also allows many Microsoft Windows™ operating systems and legacy operating systems to run unmodified.
The third virtualization mode is hardware virtualized, with paravirtualized drivers (PVHVM). This mode is identical to hardware virtualized, but with additional paravirtualized drivers installed in the guest's operating system to improve virtual machine performance.
Hardware virtualized (HVM):
Hardware virtualization, or fully virtualized. When you create an HVM guest, you must supply an ISO file in a repository from which to create the virtual machine. To create HVM guests, you may need to activate the hardware virtualization in the BIOS of the server on which you install the Oracle VM Server.
PVHVM: Identical to HVM, but with additional paravirtualized drivers for improved performance of the virtual machine. This Domain Type is used to run Microsoft Windows guest operating systems with an acceptable performance level.
PVM: Paravirtualized. Enables you to select a location for the mounted ISO file from which to create the virtual machine. Before you create the virtual machine using the paravirtualized method, mount the ISO file on an NFS share, or HTTP or FTP server. You supply the location of the mounted ISO file in the Boot Options step of the wizard.
For more information, look at this URL.
I hope this can help you