Sighters are placed so they are in the leader section that is held just above the water. They are generally not in the butt section of the leader as was common years ago for the red butt leaders.
The closer the sighters are to the fly, the more effective they are at telegraphing the strike and your vision is directed at the drift rather than at the leader butt or rod tip.
See this section of Daniel's book, Sighters - Dynamic Nymphing.
Click on the book title and go up and down the pages to read about sighters from the book.
This article also describes where to put the sighter.
Euro Nymphing Leader Setup | Gil Fly Fishing