As a rule, colours are calculated across a matrix profile and corrected across the relevant monitor profile in the operating system. Colours to be corrected are discarded by the colour profile, which reduces the number of colours that can be displayed by the graphics card.
With an LUT, on the other hand, colour value tables are used which serve to transform source colours to goal colours. Since the colour values are not calculated here, but rather saved as set co-ordinates, output is faster and more precise.
A graphics card has a colour display of 8 bits per colour channel, which is equivalent to 2 to the power of 24 colours (16.77 million). If a monitor has a 10-Bit LUT internally, it can display 2 to the power of 30 colours (approx. 1 billion), in that it simulates the missing colour values on the screen in a precise manner.
This is a considerably higher number of colours that the eye can distinguish, but bringst he advantage that even the finest colour gradients can be displayed without stripes.