.The Russell 2000 might have a profitability problem.Though the small-cap mark gained 10.1% in July, it is actually lost roughly 4% so far in August, since Thursday morning.ALPS' Paul Baiocchi earns the volatile moves to the mark's total arrangement, along with an estimate coming from Beauty Global presenting 40% of those providers possess damaging earnings." [Capitalists] have actually basically resigned themselves to the simple fact that by remaining in the Russell 2000, I am actually only heading to must take the really good along with the bad," the organization's main ETF planner informed CNBC's "ETF Upper hand" this week.To steer clear of the productivity burden, Baiocchi recommends capitalists focus on top quality companies, taking a look at additional careful exchange-traded funds such as his firm's O'Shares united state Small-Cap Premium Dividend ETF Reveals (OUSM)." The concept is quality business that pay and also increase their dividends, and also significantly, have a lot less dryness than their peers," he said. "It allows experts and also capitalists that have actually found little caps go sideways for 5 years to become allocated to a classification that's lagged." Besides its success screen, the fund has only 107 supplies u00e2 $" a fraction of what's inside the Russell 2000. Its own leading 3 holdings are actually Tradeweb Markets, Juniper Networks and also Old Republic International, each sitting at an around 2% weighting in the fund, every FactSet.Shares of the small-cap fund are actually down 1.5% month to day u00e2 $" surpassing the Russell through much more than 2 percentage factors because time.Disclaimer.