You should choose a vSphere HA admission control policy based on your availability needs and the characteristics of your cluster. When choosing an admission control policy, you should consider a number of factors.
Avoiding Resource Fragmentation
Resource fragmentation occurs when there are enough resources in aggregate for a virtual machine to be failed over. However, those resources are located on multiple hosts and are unusable because a virtual machine can run on one ESXi host at a time. The default configuration of the Host Failures Cluster Tolerates policy avoids resource fragmentation by defining a slot as the maximum virtual machine reservation. The Percentage of Cluster Resources policy does not address the problem of resource fragmentation. With the Specify Failover Hosts policy, resources are not fragmented because hosts are reserved for failover.
Flexibility of Failover Resource Reservation
Admission control policies differ in the granularity of control they give you when reserving cluster resources for failover protection. The Host Failures Cluster Tolerates policy allows you to set the failover level as a number of hosts. The Percentage of Cluster Resources policy allows you to designate up to 100% of cluster CPU or memory resources for failover. The Specify Failover Hosts policy allows you to specify a set of failover hosts.
Heterogeneity of Cluster
Clusters can be heterogeneous in terms of virtual machine resource reservations and host total resource capacities. In a heterogeneous cluster, the Host Failures Cluster Tolerates policy can be too conservative because it only considers the largest virtual machine reservations when defining slot size and assumes the largest hosts fail when computing the Current Failover Capacity. The other two admission control policies are not affected by cluster heterogeneity.
vSphere HA includes the resource usage of Fault Tolerance Secondary VMs when it performs admission control calculations. For the Host Failures Cluster Tolerates policy, a Secondary VM is assigned a slot, and for the Percentage of Cluster Resources policy, the Secondary VM's resource usage is accounted for when computing the usable capacity of the cluster.