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How to hold yarn

Sorry, but this is to each his (hers) own.

You do need to make sure the yarn comes up over your index finger. 

I start the yarn over my pinky, then under my middle finger, then over my index finger.

It has to do with tension.  Play around with it until you find something you can be comfortable with.

Sorry, again.  There is no right or wrong way of  holding your yarn.