.The Russell 2000 might have a profitability problem.Though the small-cap mark acquired 10.1% in July, it's lost roughly 4% so far in August, as of Thursday morning.ALPS' Paul Baiocchi chalks up the unstable moves to the index's general composition, along with a price quote from Apollo Global presenting 40% of those firms possess damaging revenues." [Investors] have actually primarily surrendered themselves to the fact that through being in the Russell 2000, I am actually simply going to have to take the excellent with the poor," the company's main ETF strategist said to CNBC's "ETF Upper hand" this week.To stay away from the productivity nuisance, Baiocchi recommends financiers focus on high quality companies, looking at additional particular exchange-traded funds like his firm's mountain range O'Shares USA Small-Cap Top Quality Returns ETF Shares (OUSM)." The concept is actually premium companies that pay as well as grow their rewards, and significantly, have much less dryness than their peers," he stated. "It enables consultants and also investors that have seen little hats go laterally for 5 years to be allocated to a classification that is actually delayed." Besides its own productivity monitor, the fund consists of only 107 sells u00e2 $" a fraction of what's inside the Russell 2000. Its own best three holdings are Tradeweb Markets, Juniper Networks and also Old Commonwealth International, each sitting at a roughly 2% weighting in the fund, per FactSet.Shares of the small-cap fund are actually down 1.5% month to day u00e2 $" outshining the Russell through greater than 2 amount factors because time.Disclaimer.