The frequently used content and less frequently modified is eligible for buffering. Company Name, GUI, screens, calendars, table definitions, programs etc are eligible for buffering.
Data such as Exchange Rates, Transactional Data(PO, Sales Order, Invoice, Billing) are not eligible for buffering.
Buffering is specific to instance. Each buffered element is stored in the memory of the instance in terms of Directories and Space.
Eg. Programs can be stored up to 150000 KB, 150 MB in 37,500 directories. If the directories/ size is full then Buffer Swaps occurs in ST02.
When SWAP occurs the content needs to be fetched again from Database which increases the response time.