Microsoft S2D is able to leverage data tiering in a configuration where 3 distinct storage types are being used (NVMe + SSD + HDD). In this configuration the fastest storage devices, NVMe, become part of the caching tier, whilst SSD devices and HDD devices automatically become part of the persistent storage tier. Within the persistent storage tier, the SSD devices are part of the performance sub-tier and the HDD devices are part of the capacity sub-tier. The performance sub-tier is optimized for I/O (hot data) while the capacity sub-tier is optimized for Storage Efficiency (cold data).