flatten the sides going to the trailing edge, then sand it square.
The flow separates either before or at the traling edge.
Basically where you have too large convex curvature the flow can separate. This means you get a pocket of highly turbulent flow extending behind where the flow separated. The thicker the pocket the higher the drag. So the thicker the fin where it separated, the higher the drag. Yes, insert golf ball graphic here... its relevant because the dimples delay flow separation on a golf ball by making the flow turbulent before it detatches. (note: dimples not required on a fin!!!). This has the effect of keeping the flow attached for longer, where it separates closer to the back of the ball. In a fin, the flow is likely to be turbulent before it gets near the trailing edge without the assistance of visible dimples (all to do with the viscocity of water compared to air, and the speed we go). But the effect on drag is the same- if the flow separates where the profile is thinner, the drag will be lower. On the golf ball, delaying the separation decreases the turbulent wake thickness and makes a huge difference to both stability, and efficiency. Same for fins.
So, if our fin hasnt been finished properly in the factory (gee I wonder if that ever happens

- picture short dude with a big buffing wheel in overalls smoking a fag and 20 fins on a rack waiting for "precision hand finishing"

) the trailing edge will be rounded, so the flow separates before the trailing edge, the turbulent wake is thicker and the drag is higher. So by sanding out all the tight curves near the trailing edge (can involve a lot of sanding on some fins), you shift the separation point closer to the trailing edge where its at its thinnest. Squaring off the trailing edge creates a clean separation point. Making a fin perfectly sharp (if it were possible) offers very little improvement in drag. Its already really thin and there are other effects that increase the turbulent wake thickness due to the combination of the flow from both sides of the fin. *Trying* to make it perfectly sharp makes the flow separate early because you will have introduced a tight curve in there even if you might not see it. Early separation leads to vortex shedding and other separation effects => whistling, drag increase, and possible loss of lift. Has anyone ever used a stock Select?

Simple

But always use a cover over the fin when pulling it out of the box

You now have a double edged blade thats still quite sharp and becomes serated with a few nicks... If you feel safer with a thicker trailing edge, then its really important to square it off properly so it doesnt add unnecessary drag.
0.5mm is more than thin enough IMHO