Here's a "How to" I put together a while back. It shows the type nocking point I prefer.
Nocking point how to There are several variations that can be done using this tutorial.
I prefer a nocking point that's below the arrow nock. The reason being that most often an archer is prone to putting top finger pressure on the arrow during his draw. This can actually cause the arrow to move downward on the string slightly.
A slightly low nocking point will cause poor arrow flight while a slightly high one won't.
In my case the "nocking point" is just an indicator that helps me find the right spot without looking. The double serving (above and below the nock) forms the actual nocking point (the space in between) and the arrow can fit no other place.
To each his own.