Hypervisors
Type I Hypervisor
The hypervisor runs directly on top of hardware
Type II Hypervisor
The hypervisor acts like separate layer often on top of a base operating system
KVM
KVM is a Type II Hypervisor, which means that it is one layer above the OS. On a bare metal machine, install an OS, and THEN install KVM. In Linux it is installed in the form of a Kernel, and this kernel then turns the bare metal machine into a Hypervisor.
KVM will offer better performance with the Linux OS.
XEN
Xen is a Type I Hypervisor – which means it sits a single layer above bare metal. It’s like a stripped down operating system, and it uses a function called “pass-through” to connect directly to PCI devices like RAM/CPU/NICs.
Reference :
Infra Cloud Solutions 