Which is better: convert bootcamp or use new virtual machine?

I wish to install W7 on my iMac.
As I understand it there are two ways to do this:
1. Install W7 using apple's bootcamp and then let Parallels use the bootcamp partition, or
2. Create a new virtual machine with parallels and then install W7 in that vm.
Which is the better method? Pro's and cons?
Many thanks, Edwin