Mike Sealy of UCLA shows two different methods of hand position for setting: one that generates power from the wrist, and the other that generates power from the forearm.
The first method is using the wrist to power the set, and the position for the hands allows the fingers to turn in and down. Most of the power is generated from the wrists (which can fatigue the wrists, but many setters use this method effectively).
The second method is to shift the weight to the forearms by keeping your fingers from turning down. This can often help younger players, or players with weak wrists, to power the ball with the forearm strength.
Simple drill to practice hand strength: Set back and forth with one hand touches.