Large Language Models (LLMs) are distinguished by their architecture, which dictates their parameter size and performance capabilities. Social scientists have increasingly adopted LLMs for text classification tasks, which are difficult to scale with human coders. While very large, closed-source models often deliver superior performance, their use presents significant risks. These include lack of transparency, potential exposure of sensitive data, challenges to replicability, and dependence on proprietary systems. Additionally, their high costs make them impractical for large-scale research projects. In contrast, open-source models, although available in various sizes, may underperform compared to commercial alternatives if used without further fine-tuning. However, open-source models offer distinct advantages: they can be run locally (ensuring data privacy), fine-tuned for specific tasks, shared within the research community, and integrated into reproducible workflows. This study demonstrates that small, fine-tuned open-source LLMs can achieve equal or superior performance to models such as ChatGPT-4. We further explore the relationship between training set size and fine-tuning efficacy in open-source models. Finally, we propose a hybrid workflow that leverages the strengths of both open and closed models, offering a balanced approach to performance, transparency, and reproducibility.

In this paper a new dissimilarity measure to identify groups of assets dynamics is proposed. The underlying generating process is assumed to be a diffusion process solution of stochastic differential equations and observed at discrete time. The mesh of observations is not required to shrink to zero. As distance between two observed paths, the quadratic distance of the corresponding estimated Markov operators is considered. Analysis of both synthetic data and real financial data from NYSE/NASDAQ stocks, give evidence that this distance seems capable to catch differences in both the drift and diffusion coefficients contrary to other commonly used metrics.