I'm confused about SimulationMode option available on version 2022+

Hi, so when I updated my project from 2021 to 2022+ I had some issues with interactions on my game (grabbing objects). When I changed the SimulationMode under “Project Settings → Physics → SimulationMode” from Fixed Update to Update the issue was immediately solved. I’m concerned this will affect how FixedUpdate runs and bring some other issues with it. You can find the explanation Unity has for this option here. From my understanding, choosing “Update” Unity will run the physics simulation at the same rate Update() runs?

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