Pick hand fingers must be curled into the palm. This helps with economy of motion. The pick hand is free to zip and zing. With the fingers stretched out, gravity is pulling the hand down and away which requires more strength to pull the pick back and forth so you lose.
If you don't believe Pebber, I asked Warren DeMartini from Ratt the same question once. I had been taking lessons from Pebber and one of the first things was he made me stop fanning the pick hand fingers out. I noticed Warren stopped doing it as well. I asked him why he stopped. He said, "It (the pick hand fingers fanned out) is like driving your car on the freeway in 1st gear the whole time."
So, curl the fingers into the palm. Not tightly. Very loose. This is the correct method. And even guys like Warren who fanned the fingers out for years are seeing it is not economical.
Hope this helps.
-U