Spatial modulation (SM) and generalized spatial modulation (GSM) are emerging multiple input multiple output (MIMO) schemes that use transmitter (TX) antenna switching for data transmission. Their operating principle makes optimization of channel capacity and mutual information usually more difficult than for conventional MIMO schemes which are not based on antenna switching. We propose to use channel cut-off rate as a relevant and more tractable metric for performance optimization of spatial modulation (SM)/GSM systems, as it constitutes a practical lower-bound of channel capacity. In particular, we propose four TX precoding schemes for increasing the cut-off rate of SM/GSM systems. We show that those TX precoding schemes which are designed for increasing array gain provide the largest improvement of cut-off rate for low signal-to-noise ratio (SNR). On the other hand, the TX precoding schemes that are designed for increasing the minimum Euclidean distance of GSM symbols are more suitable for application to medium to high SNR setups and correlated channels. The proposed precoding schemes are shown to be able to enhance mutual information, and the gain is shown to be of the same order of magnitude as the gain of the corresponding channel cut-off rate.