Yes, there is a way to run older and newer releases of MacOS in a VM using parallels. The parallels blog has some walkthroughs on how to do this, but they're quite complicated and didn't work for my use case (trying to run an older MacOS version in a VM)
If you're familiar with programming, an easier way is using gibMacOS to download the exact version of MacOS that you want to run in a VM, turn it into an installable package, and then use the "Install Windows or other OS from DVD or image file" option in parallels to install that.
If you're not a developer, here are the steps to use gibMacOS:
- Download the project zip file and unzip it
- Run the gibMacOS.command script. You will see a menu with the available OS releases. Pick the one you want to run in the VM. Wait for it to download.
- When it is finished downloading, it will tell you where the result was saved.
- Run the BuildMacOSinstallapp.command script
- Drag & drop the InstallESDDmg.pkg file downloaded in step 3 to the terminal window. It will create a MacOs .app up to about 10 Gb in size
- Use parallels "Install Windows or other OS from DVD or image file" to install this .app in a VM