.The Russell 2000 might have a profits problem.Though the small-cap mark got 10.1% in July, it's fallen approximately 4% until now in August, since Thursday morning.ALPS' Paul Baiocchi achieves the inconsistent transfer to the index's overall arrangement, with a quote from Beauty Global showing 40% of those providers possess damaging earnings." [Clients] have actually primarily resigned on their own to the truth that through residing in the Russell 2000, I'm just heading to must take the good along with the poor," the organization's principal ETF planner said to CNBC's "ETF Upper hand" this week.To stay away from the productivity nuisance, Baiocchi proposes real estate investors focus on quality firms, looking at additional discerning exchange-traded funds such as his agency's O'Shares USA Small-Cap High Quality Reward ETF Portions (OUSM)." The idea is top quality providers that pay for and grow their dividends, and significantly, have less volatility than their peers," he said. "It permits experts and clients that have actually found tiny caps go laterally for five years to be allocated to a classification that is actually lagged." Besides its own earnings display, the fund contains simply 107 stocks u00e2 $" a fraction of what is actually inside the Russell 2000. Its top three holdings are Tradeweb Markets, Juniper Networks as well as Old Republic International, each resting at an about 2% weighting in the fund, per FactSet.Shares of the small-cap fund are down 1.5% month to date u00e2 $" surpassing the Russell through more than 2 percent aspects in that time.Disclaimer.