What is Oracle Home?

The Oracle home directory, denoted by the ORACLE_HOME environment variable, is very important,
since the Oracle server software executable files and other configuration files are located under this
directory.
For example,
the $ORACLE_HOME/bin directory holds the executables for the Oracle products,

and the $ORACLE_HOME/network directory holds the Oracle Net Services files.

In Oracle Database 11g, the OFA-recommended Oracle home directory path has changed.
In order to comply with the OFA requirement of enabling the simultaneous running of multiple
versions of Oracle software, you need to install Oracle software in a directory with the following path:

/pm/h/u/product/v/type_[n],

where the new variables have the following meanings:
v: The version of the software
type: The type of installation, such as database (db), client (client), or companion (companion)
n: An optional counter, which enables you to install the same product multiple times under the
same Oracle base directory
In the preceding syntax for the Oracle home, the first part, /pm/h/u, is nothing but the Oracle
base directory. Thus the Oracle home directory is always located underneath the Oracle base directory,
and it can also be specified as $ORACLE_BASE/product/v/type_[n].
Using the preceding OFA-based Oracle home path, you can install different products—the
server and the client with the same release number (Oracle 11.1.0)—in the same Oracle base
directory.