.The Russell 2000 might possess a profitability problem.Though the small-cap mark acquired 10.1% in July, it is actually lost about 4% up until now in August, as of Thursday morning.ALPS' Paul Baiocchi chalks up the unpredictable moves to the index's overall composition, along with a quote from Beauty Global presenting 40% of those companies possess adverse incomes." [Capitalists] have actually essentially resigned themselves to the reality that through residing in the Russell 2000, I'm just visiting need to take the excellent along with the poor," the firm's principal ETF planner informed CNBC's "ETF Upper hand" this week.To steer clear of the productivity bother, Baiocchi recommends entrepreneurs prioritize premium firms, looking at even more careful exchange-traded funds like his firm's mountain range O'Shares united state Small-Cap Top Quality Reward ETF Shares (OUSM)." The suggestion is high quality business that spend as well as expand their rewards, as well as significantly, have much less volatility than their peers," he stated. "It enables consultants as well as entrepreneurs that have actually observed tiny hats go sidewards for 5 years to be designated to a group that is actually delayed." Besides its own profitability screen, the fund consists of only 107 stocks u00e2 $" a fraction of what is actually inside the Russell 2000. Its own leading 3 holdings are actually Tradeweb Markets, Juniper Networks and Old Republic International, each sitting at an around 2% weighting in the fund, every FactSet.Shares of the small-cap fund are down 1.5% month to day u00e2 $" outperforming the Russell through greater than 2 percent points during that time.Disclaimer.