An Operating System running in a virtual environment will not perform as well as an Operating System running natively on the same hardware.
Parallels provides a virtual machine environment, but does not support "all" the functionality of Windows XP - For example, there is no Direct X support in Parallels.
Parallels Desktop for Mac
Bootcamp is a dual-booting process that allows you to run Windows XP natively on the Intel hardware in the Mac. Running Windows XP in this way would give you "all" the functionality possible on the hardware, and would definitely run faster that is would running the virtual machine provided by Parallels in the MacOS.