If you already know how to tie tzitzit, regardless of whether you tie Ashkenazi, Sephardic, Yemenite, Chabad, techelet, etc., you may be wondering how snug to make that first knot.
This may sound like a very simple question, but it's not (no pun intended). The issue behind how tight the first knot on the tzitzit should be is a halacha regarding where the tzitzit should hang down.
We know that the Karaites understood that tzitzit should be right on the corner, but Chazal determined that putting tzitzit on the kanaf, as the Torah says, actually means the hole should be near the corner, but not right on the corner. They held it should be at least the distance from your thumb knuckle to the tip of your thumbnail, and no more than the width of three fingers (Shulchan Aruch 11, 9). Today the standard distance is 5 cm, measured from the bottom and the side, not diagonally from the corner.
But there's also another halacha that the tzitzit should be notef al hakeren, which means they should dangle in such a way that they fall right along the corner itself (Shulchan Aruch 11, 15). So then a problem arises. If you don't tie that first knot nice and snug, the tzitzit are going to roam around the corner and hang off the bottom edge of the tallit, which means they won't be notef al hakeren at all. I see this all the time in shul, but I keep my mouth shut. Here are a few ways to approach the issue:
1. Make the first knot snug enough so that a bit of the cloth bunches up, which will prevent the tzitzit from sliding around the corner. The Chazon Ish recommended this solution, and today you will see diehard Chazon Ish adherents in Bnei Brak and elsewhere who take this to an extreme.
2. According to some opinions, if you bunch up the fabric too much you lose the required 5 cm between the hole and the edge of the garment. I'm under the impression that some Sephardim have a tradition of following this opinion, therefore they are careful not to bunch the fabric up at all. Even according to this opinion, it seems to me you can still bunch up the fabric a bit, because the minimum distance is actually a bit less than 5 cm, so you have some leeway.
3. One of the Lubavitcher rebbes a few generations ago wanted to have his cake and eat it too, so he devised a way to tie the tzitzit without bunching up the fabric and with no risk of the tzitzit wandering around to the wrong side. Take a close look at the Chabad tallit to see his innovative idea of anchoring the shamash string using a second hole in the tallit.
Note that some tallits have stiffer corners than others, so take this into account when deciding how tight to make the first tzitzit knot.