Guys who play DayZ

ARMA3 Settings Guide

Sampling
This sets the rendering resolution of the game to something other than your native window. Settings lower than 100% are upscaled (like games consoles), and settings higher are downscale.
Lower range systems can use settings below 100% with FXAA to gain frames at the cost of blurring out the screen. At 50%, you could potentially double your FPS - though the lower rendering resolution will make it harder to spot targets at range. Only lower this if you're not getting any luck with other settings though.
Mid and higher end systems should leave it to 100% with FXAA or low AA. This will make sure you don't put yourself at a disadvantage.
Enthusiast systems should experiment with >100% in conjunction with AA. This is called super-sampling, and it's one way of getting very accurate AA and very high image quality. If you're finding that Arma3 is not using enough GPU power, then this is the setting you can change to force it to work harder without losing frames.
If you're going to be doing a lot of YouTube recording or streaming, you might want to make sure this is turned off (i.e. 100%.) I've noticed some weirdness on video captured with Fraps and Shadowplay with sampling turned up, and it doesn't look like it does on your display.
Texture quality
Generally won't have much of an effect on frames, but higher settings will hammer your video RAM. If you have it set too high (in combination with other settings), you'll run out of VRAM. This stops more textures/objects loading in properly, and stuttering performance while your hard drive and VRAM swap things around.
Only use ultra if you've got VRAM to spare, and a fast enough hard drive (SSD is ideal) to cope with the swapping - or in combination with shorter object draw distances.
Objects
As above, this is a memory hog. Objects deals with LOD settings - i.e. how detailed world elements are. Lower settings will cause a lot of LOD popping, but will lower memory usage. Higher settings will also have a considerable impact on framerate as well.
Even on higher end systems, 'standard' tends to be adequate. Higher settings will render the highest quality models further out - but by that point their resolution is so small on the screen it doesn't make too much of a visual difference given the performance costs.
LOD is also affected by 'object draw distance', and with this setting combined it effectively creates a 'curve' of quality.
Terrain
Annoyingly, this setting actually controls two different things - Terrain mesh resolution, and grass render distance. This sucks.
If you've ever looked through a scope at objects in the distance on a mountain top and noticed they're floating off the ground, or you snipe somebody only for the bullet to hit invisible terrain, you are a victim of lower terrain mesh quality.
This can be fixed by using higher terrain settings - but then you also end up with grass render distance set further out, lowering your FPS. This is a pointless connection between two unrelated settings, and I have no idea why the connection even exists, but hey, whatever. Terrain tessellation doesn't have that huge an effect on performance (evident in previous versions of Arma3 where they were separate settings), but grass render distance really does.
It's not really that much of a problem unless you're a fan of anti-material rifles or tank gunnery.
Shadows
Here's a quirky one. Some of the settings in this menu are rendered by the CPU, some by the GPU. I think it's 'Very High' and 'Ultra' that are rendered on the GPU, and everything else (apart from 'disabled') is rendered on the CPU though feel free to correct me. This may mean that - depending on your CPU/GPU - you get better performance with the ultra settings than you do with the lower settings!
If you experience artifacting like this, then you might need to fiddle with this setting. (thanks /u/shenquo)
Particles
I'm under the impression this one is the same situation as shadows - i.e. the very highest settings are GPU particles, and the rest are CPU. Lower settings may help your FPS in situations where there's a lot of smoke or dust.
Cloud
'Standard' all the way, regardless of your machine. Visual quality difference between 'standard' and 'ultra' is neglegable at best, and this will gain you frames on stormy/cloudy days.
PIP
Depending on your horsepower, this setting can either make no difference at all or be a huge performance saver if you turn it off.
PIP isn't actually that useful as it stands unless you play in no third person servers. Most of the PIP gun screens aren't zeroed correctly (or even line up with the barrel) and are too low resolution to be practical. The car mirrors are nice, but redundent if third person is on.
Broken in SLI/Crossfire, as it seems that only every other frame is rendered correctly. Seems to have been resolved! Nice one BIS.
HDR
Actually quite a big difference between 'low' and 'high' - you might see about 10 frames more if you switch to 'low' but it also makes a pretty drastic difference to the visual quality. 'low' saps colour and makes Altis look a bit washed out. Oddly, there's no 'disabled' - presumably because it would give a competative advantage.
there is no way to disable HDR because the entire lighting system is dependent on it. As Maruk has mentioned before, if you were to outright disable HDR, you'd likely see nothing but a black screen.
Dynamic lights
Makes zero difference in daytime hours - dynamic lights are completely disabled between sunrise and sunset even if they're turned on. Might give a small boost on lower settings at night, but may also put you at a competative disadvantage as lights that other players can see may be invisible to you.
Visiblity
These are the big ones. Keep in mind that your visibility settings (except for shadow) are completely ignored in multiplayer if they are higher than the server's settings. If you want to optimise your other settings for MP, set overall and object visibility to 2000 and go from there.
OVERALL defines your terrain draw distance. Even lower powered machines can sometimes cope having this set to far in excess of the 'object' draw distance.
This also affects the distance at which AI can acquire targets. Back in the OFP days, if you put view distance up too high then tanks would snipe you from the other side of the island. It's not as bad or obvious now, but still something worth keeping min mind as it does affect difficulty in some circumstances.
Likewise, setting it really low may affect gameplay if AI that are supposed to be able to see something cannot.
OBJECT defines how far you render objects out to, and also has an effect on your LOD curve (in combination with 'objects' quality). In an ideal world, you want this to equal your draw distance. Some players are happy with it being less, however also keep in mind that it also affects the rendering of units on the battlefield. You might be able to see that mountain, but you won't be able to see the artillery piece on it, even with a scope!
Some large buildings are marked as 'always visible' and will render much further out than your object draw distance distance is. Some examples of this would be the wind turbines and the solar towers.
SHADOW is just your shadow rendering distance. Depending on horsepower and whether it's your GPU or CPU doing the work, you might see no difference between the highest and lowest setting, or you might see a few frames.
And lastly, a note on shadows: The lower your shadow draw distance, the higher your shadow resolution is. So if you play primarily close quarter combat missions, setting this to around 80 will make things look much better. If you play primarily armor or long range/long travel missions, 200 will give you the best visual fidelity.
(Thanks /u/The_Capulet)
Bloom
No affect on performance. Personal preferance, but I recommend 0.
Radial blur/Rotation Blur
Only used when you are injured or turning the camera respectively. On some systems, this shader can cause slowdowns, and it's quite significant too as it jumps on and off. You also put yourself at a tactical distadvantage as it makes it harder to spot targets when moving view/injured. If you're a realism nut, you might welcome the handicap, but otherwise turn it off for a smooth performance and for the sake of gameplay.
Depth of Field
Blurs the edges of the screen and objects deemed 'too close' when looking down a scope. Can cause weird artifacting on illuminated gunsights and point lights at night. Recommend 0.
Caustics
Sun rays and godrays underwater. Seems to have little affect on performance, though I didn't play around with it much when I still had a lower end PC.
AO
Ambient occlusion - simulates global illumination by darkening where planes meet. This is a very demanding setting, and scales linearly based on screen resolution (or sampling). This most obvious effect in Arma is that it makes grass look like it's casting a soft shadow on the ground beneath it.
SSAO is generally faster, whereas HDAO arguably looks better. HDAO is a lot more demanding though. On my system, there is no framerate difference between 'disabled' and 'SSAO High', but any HDAO setting will lose 10 frames.
There might potentially be a difference for AMD/ATi users here:
> on my system which is a Medium/High rig with a XFX 6870 and AMD FX8320. And by switching from AO "Disabled" to HDAO "Very High" I lose only 4 fps. On the other hand SSAO "High" loses 12 fps. (Thanks /u/Shenquo)
FSAA
Good ol' fashioned FSAA gets rid of jaggies by sampling triangle data. If you're an AMD GPU owner, you might struggle with higher settings. Nvidia eats AA for breakfast though, and combined with supersampling you can make incredibly smooth edges.
ATOC
Alpha to coverage. It's a bit hard to explain how this actually works, but essentially it allows AA to smooth jaggies on texture with transparency - i.e. grass and trees. There are three different base settings that are tweaked different for specific islands
ATOC's settings are old placeholder settings from Arma 2, where it would act as more of a filter for which objects it should and shouldn't apply this to. So if you selected "arma 2 grass & trees", you'd get fuller trees and grass for Chernarus but not for Takistan. The setting to use now is the default arma 3 setting, which applies it to all objects. I think the biggest advantage to using this setting is that the trees actually look like trees at every distance, rather than looking quite bare (Due to the aliasing hiding portions of the texture) until a more full LOD pops into place. ie, it helps a ♥♥♥♥ ton with vegetation LOD popping (TL:DR: use the default Arma 3 profile -Thanks /u/The_Capulet)
The big difference here is whether you only apply it to trees, or if you also apply it to grass. Grass is very demanding for ATOC, but the visual difference is quite striking, especially grass on ridgelines that is up against sky.
Does not function at all if FSAA is disabled.
PPAA
Post-process antialiasing. These smooth edges via shaders (i.e. processing pixels instead of triangles). This results in a much lower performance hit in comparison to FSAA, but it typically doesn't look as good, especially in motion.
SMAA gives a result that's visually similar to FSAA and supersampling. Generall smooth and flat, but it can look a little blurry on details.
FXAA gives a much sharper result, but is a little more prone to artifacting.
Using PPAA in combination with lower FSAA settings can be benificial, but with higher FXAA settings and supersampling it can also start adding visual artifacts like pixel walking and flicker.
If you're running at less than 100% sampling, you'll probably need PPAA to help fight the jaggies.
Anistropic filtering
Prevents moire and screen door effects on repeating flat textures.
Every graphics card since the year 2000 has had no problem with AF, and there is no reason to run this at any setting other than 'ultra' unless you're trying to play on integrated graphics or something silly. If you're supersampling, it doesn't make much of a difference either way, but as it causes no real noticable performance drop, it's not even worth the effort of turning it off.