.The Russell 2000 might have a profitability problem.Though the small-cap index acquired 10.1% in July, it's gone down around 4% until now in August, as of Thursday morning.ALPS' Paul Baiocchi records the unstable moves to the mark's general composition, along with an estimate from Beauty Global showing 40% of those firms have damaging incomes." [Entrepreneurs] have actually basically resigned themselves to the fact that through residing in the Russell 2000, I am actually simply visiting must take the good along with the negative," the firm's main ETF strategist told CNBC's "ETF Upper hand" this week.To stay away from the productivity drag, Baiocchi recommends capitalists prioritize top quality providers, examining even more particular exchange-traded funds like his firm's ALPS O'Shares united state Small-Cap High Quality Reward ETF Reveals (OUSM)." The idea is actually premium business that pay out and increase their rewards, as well as significantly, have less volatility than their peers," he stated. "It permits consultants and also entrepreneurs who have actually viewed tiny caps go sidewards for 5 years to become allocated to a group that is actually delayed." Aside from its profits display screen, the fund consists of only 107 sells u00e2 $" a portion of what's inside the Russell 2000. Its own leading 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 $" surpassing the Russell through much more than 2 percentage aspects in that time.Disclaimer.