Wikipedia - look at Fig. 3; that's what I'm talking about.
If it is possible to make the edges of a hairstyle or piece of clothing or jewelry look like the diamond on the left, do it! It makes it much easier for an editor to deal with a base if the edges are like that. Here's what it entails when it is aplied to avatar edits. Pardon my sloppiness; these are only examples:

This edit is done right. You can see in the zoomed view that the edges are clearly defined, and that makes it easy for an editor to add clothing. Real Gaia items have hard edges like this too, so it's mroe realistic to do it this way.

This is the same edit, but anti-aliased. It looks fine at 100% zoom, but when you zoom in you can see that the edges of the hair are blurry. That makes it really hard for a new editor to add clothing, because it's hard to tell where the hair ends and the not-hair begins.
This is not an issue if you don't intend to sell a base, because on your own computer you can just make a new layer below the hair and it works out fine. But when you save it as a .jpg or a .png and give it to another editor to add something, that leaves no more layers, so the second editor has to guess where the hair ends and it winds up looking not very nice despite her best efforts.
If someone gives me the first base and says "Make me an edit with this base," I can do it easily. The second, I'd have to do a lot of guesswork and there would be stray pixels everywhere and it would be a mess.