Dual branch switched diversity in compact wireless devices is considered. A simple technique for protecting a compact device from diversity loss incurred by antennas proximity is proposed. The technique is based on implementing the Karhunen-Loeve transform prior to down-conversion to baseband. The implementation reduces to constant and straightforward summation and subtraction of the two antennas RF outputs, and there is no need for channel estimation or additional operational complexity. It is shown that the proposed implementation protects the system from diversity loss by reducing outage probabilities, increasing the average SNR, and drastically lowering the mean switching rate. Implementation of the Karhunen-Loeve transform is achieved using a single RF combiner component located prior to the RF switch.