Explanation
You must create a dedicated virtual machine host before you can place any instances on it. When creating the dedicated virtual machine host, you select an availability domain and fault domainto launch it in. All the VM instances that you place on the host will subsequently be created in this availability domain and fault domain.
You also select a compartment when you create the dedicated virtual machine host, but you can move the host to a new compartment later without impacting any of the instances placed on it. You can also create the instances in a different compartment than the dedicated virtual machine host, or move them to difference compartments after they have been launched.
You are billed for the dedicated virtual machine host as soon as you create it, but you are not billed for any of the individual VM instances you place on it. You will still be billed for image licensing costs if they apply to the image you are using for the VM instances.
Read more: https://docs.cloud.oracle.com/en-us/iaas/Content/Compute/Concepts/dedicatedvmhosts.htm