Is this a security issue? Home folder being shared

I have just created a new Windows 11 ARM VM in a Macbook M1 Pro using Parallels.
I just used the very-easy-to-use wizard which downloads, installs and configured the Windows for me, and changed some configurations in both VM and Windows itself.
However, I noticed an issue that worried me and looks like a serious security flaw.
I have configured the "Shred Folders" settings to be "None". If I click "Custom Folders..." button, there is nothing there. So far, so good.


However, Parallels added my whole Home folder in Windows as a mapped drive. So it's fully accessible. Isn't this a serious bug? Am I missing something?