What you need to do is setup and ntp.conf file
here is mine:
fudge 127.127.1.0 stratum 3
1. Runs only for the local machine (ntpd can be used to run a time server for others as well).
2. Sets up the servers to use
3. What that does is sets /var/lib/ntp/ntp.drift as the drift file (don't worry about it, just make sure you choose a place that ntpd can write to).
4. Tells it to log to ntp.log in /var/log
I removed the server addresses I use, please look up addresses here: http://www.eecis.udel.edu/~mills/ntp/clock2a.html
Now that file should go in /etc
Run ntpd with a command line like ntpd -u ntp:ntp
This requires you have a user/group called ntp and will run the server under that user or group. It is safer then running it as root.