When shining your shoes with a rag or a shoe shine cloth, the most important part of it is the way you hold the cloth while polishing so that you get a smooth polish when polishing your shoes.
Step 1: Place your two fore fingers in the cloth ( Left handed or right handed)
Step 2: Pull down on the cloth to create a tight wrap around the fore fingers.
Step 3: Twist the cloth counter clockwise. Forming a tight twist to keep your fore fingers secure.
Step 4: After tightening the cloth take the hand with the wrapped fingers and loop it under the hand holding the cloth.
Step 5: The twisted cloth piece should land up by your thumb, lift up your thumb and place the cloth through your thumb and forefingers. Have the thumb hold the cloth in place.
Step 6: Then split your fingers down the middle like Spok from Star Trek and wrap the rest of the cloth around the ring finger and pinky finger.
This should give you a tight grip of the cloth and create a smooth polish and finish.
Take a look at the video below to get a thorough idea of how to hold the shoe shine cloth.