If you are running a macOS Monterey 12 virtual machine on a Mac with Apple M series chip, you may notice a lack of cogwheel configuration icon.

This is because currently, adjusting the configuration of such a virtual machine is only possible by editing a configuration file inside the virtual machine package.

The following settings of a macOS virtual machine on a Mac computer with Apple M series Chip can be adjusted: 

• number of CPU cores allocated to the virtual machine;
• amount of RAM allocated to the virtual machine;
• network mode (Shared/Bridged);
• virtual machine's display resolution and pixel density;
• sound toggle.

Note: macOS ARM VM's disk size is 60 GB by default. It can be set to a different value during the manual installation process, but once the virtual machine is created, disk size cannot be changed.

To adjust the aforementioned settings, please perform the following steps:  

1. Shut down your virtual machine.
2. Locate the virtual machine .macvm file: click on Parallels icon || > Control Center > right-click on the virtual machine > Show in Finder. 
3. Right-click .macvm bundle > Show package contents.
4. Locate config.ini file. If it doesn't exist, open Terminal (Applications > Utilities > Terminal) and execute the following command:

   touch ~/Desktop/config.ini

   This will create a config.ini file on your Mac Desktop. Drag and drop it inside the .macvm bundle.
    
5. Open the file in TextEdit: right-click config.ini > Open With > Other, check Enable All Applications select Text Edit, and click Open.
   
   
6. Add the following text:

   [Hardware]
   vCPU.Count=2
   Memory.Size=2147483648
   Display.Width=1312
   Display.Height=824
   Display.DPI=226
   Sound.Enabled=1
   Network.Type=1

The text above represents a generic configuration. You can change the resolution by adjusting Display.Width and Display.Height values, toggle network mode between Shared and Bridged by changing Network.Type (see KB 128519), change the amount of RAM (in bytes) by adjusting Memory.Size etc.

Once you've made the necessary adjustments, simply press CMD+S to save the changes, and start the virtual machine.

Share Mac files with the virtual machine

File sharing between the main system and a macOS ARM VM is not supported. This includes consequential features such as drag-and-drop. However, you can share files between the virtual machine and the Mac using the native macOS file sharing feature as you would between two physical Mac computers.

Add a secondary virtual hard drive

As an advanced step, you may connect an .dmg or .img disk image as a secondary virtual hard drive.

It may be useful for example to transfer large amounts of data between two macOS ARM virtual machines or when you need to extend the storage capacity of a virtual machine without having to recreate it.

Create an empty image

To create an empty .dmg image, open Terminal (Applications > Utilities > Terminal) and execute the following command:

hdiutil create -size <size_in_bytes> -fs APFS -type UDIF -volname <volume_name> <output_img_path>

E.g.,

hdiutil create -size 20000000 -fs APFS -type UDIF -volname "MyVolume" ~/Desktop/mydisk.dmg

will create a 20-megabyte mydisk.dmg file on the Desktop. When connected, the volume will show up as "MyVolume".

Create a read-only image from a directory

To turn a macOS directory into a read-only .dmg image, open Terminal and execute the following command:

hdiutil makehybrid -hfs -hfs-volume-name <volume_name> -o <output_img_name> <directory_path>

E.g.,

hdiutil makehybrid -hfs -hfs-volume-name "MyVolume" -o ~/Desktop/mydisk1.dmg ~/Desktop/EmailTemplates

Connect image

To connect such an image, put it inside the .macvm bundle next to the config.ini file, and in the config.ini add the following line:

Disk1.Path=<name_of_image_file>

In the case of the example above, that would be:

Disk1.Path=mydisk.dmg

Once you run the virtual machine, and it boots up, you will see the image available in the virtual machine's Finder.

And in case of an empty image, you can transfer data to it.

Once the virtual machine is shut down, you can mount the image to your main system by double-clicking on it.