Hold the microphone in the middle. Touching it at the top will make a horrible noise, and holding it where it joins to the lead might cause crackles.
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Try to keep the microphone about 10-20 cms away from the person you're recording. Too far and it won't pick up well. Too near their mouth, and their breath might cause "pop" noises.
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Using the Clip Microphone
Clip the microphone on at about chest height. Too high and it will sound strange and boomy, too low and it will sound hollow and distant.
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When you clip the clip mic on, make sure it's not rubbing against any clothes or hair. Anything touching the microphone itself will make a dreadful noise and ruin your recording.
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Videoclips
Watch videoclips demonstrating tips, techniques and more to help you make your 60 Second Shakespeare a masterpiece.