The clearance space between piston and cylinder head must be enough to avoid contact at high engine speeds, yet close enough to keep the mixture held there cooled during the combustion process. This vertical clearance between squish band and piston should not be greater than 0.060-inch, and it is my opinion that the minimum should be only barely enough to prevent contact -usually about 0.015-inch in small engines (with tight bearings and cylinder/rod combinations that do not grow, with heat, disproportionately) and up to about 0.045-inch in big engines.
Some disagreement exists as to the validity of claims that the squish band aids combustion by causing turbulence in the combustion chamber as a result of the piston "squishing" part of the charge between itself and the head. I don't know about that, but I do know that holding squish band clearance to a minimum means that there will be the smallest volume of end-gases escaping the combustion process, and that can be more important than you might think. For example, a 250cc cylinder with a full-stroke compression ratio of 10:1 will pack its entire air/fuel charge into a volume of only 28cc by the time its piston reaches top center. Assuming that it has a 3-inch bore, and a 50-percent squish band with a piston/head clearance of .045-inch, then the volume of the charge hiding in the squish area will be in the order of 2.6cc, or almost 10-percent of the total. That can be reduced to 5-percent merely by closing the squish band's clearance to 0.020-inch - and you'll never find an easier 5-percent horsepower difference. True, the difference measured at the crankshaft might prove to be more like 2-1/2-percent, but the addition of those small percentages can make a very large final difference.