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Basically symbolic links redirect a folder to a different folder. (in a way that is invisible to software).
I'm mainly going to use gaming examples because those are some of the largest files (and only getting bigger) but this would work for any large file.
Say for example the newly released vanquish on PC. 80 percent of the size of your installation consists of large video files for cutscenes, the game files themselves are very small and only a few GB.
So now you have a game taking up 14GB of space on your SSD and most of it is cutscenes that don’t need a fast SSD to play.
You can create a symbolic link from the video folder in the game folder on your SSD to a folder on your HDD. Then you move the video files to that folder on the HDD.
You now freed up about 10GB of space on your SSD and the game can still find the video files just the same (it goes looking for them in the video folder on your ssd, which then automatically redirects it to that HDD folder).
You can free up huge amounts of space on your SSD this way without affecting load times or performance.
Now that you know what the purpose of a symbolic link is, here is how to create them:
use Dirlinker (http://dirlinker.codeplex.com/)
I found that dirlinker method to be the easiest and most convenient as it does everything for you (creates the link and moves the files for you)
OR
Open the start menu and type cmd to open a command prompt. You may need Administrator permissions depending on your environment.
Modify mklink /J "C:\The\Original\Location" "D:\New\Location" to suit your needs. The \J means "directory junction," which is Microsoft's term for a symbolic folder link.
Example: mklink /J "C:\Program Files (x86)\Steam" "D:\games" creates a symlink for your Steam games and puts them onto a different drive.
There are many games that have several GB and sometimes upto 20+GB of video files (bayonetta,vanquish, tekken 7, nier automata are some recent ones. Tekken especially has 20+GB of videos). It makes those 128 or 256GB SSDs a lot more manageable.
I recommend a software called Link Shell Extension, it makes the whole thing easy as you get the oprion to create symbolic links and more from right clicking on the folder.
a few more uses for symbolic links:
to redirect savegames to your google drive (or dropbox) folder so that your savegames automatically end up on your google drive. (good for using the same savegame on multiple computers and keeping them synced)
to force a game to save screenshots to a different folder than the default one
Windirstat is a very good tool to figure out which files and folders are taking up a lot of space on your SSD. You can use this to check your game folders to quickly see how big each of their video/screenshot/crashlog folders are so you can tell if they are worth moving to your HDD/delete them. E.g I discovered that The Surge created a 1GB crash dump every time it crashed.