This is the answer I was looking for (found it on another RC site). I'm posting it here so it could potentially help others with the same question.

The first thing you will want to do is take a fine line sharpie pen and draw a line at the leading edge of the magnet on the prop hub to the front of the hub. (as you look at the engine from the front that will be on the left side of the magnet. Then you need to take the spark plug out of the motor and put a small dowel rod inside the motor and just let it rest on top of the piston. Slowly rotate the motor over the direction that it runs, until the dowel comes all the way out of the plug hole and starts to go back in. Center the rotation of the hub by the dowel going in and out and this is top dead center. Now your mark you made on the hub on the leading edge of the magnet should be under the sensor. There is a small hash mark on the front of the sensor. Your mark should align with hash mark and this will be perfect.