.The Russell 2000 might have a profitability problem.Though the small-cap mark gained 10.1% in July, it's lost around 4% so far in August, as of Thursday morning.ALPS' Paul Baiocchi earns the volatile relocate to the index's overall composition, with an estimate coming from Beauty Global revealing 40% of those business possess unfavorable revenues." [Capitalists] have generally resigned themselves to the fact that through remaining in the Russell 2000, I am actually merely visiting must take the really good with the poor," the agency's principal ETF planner told CNBC's "ETF Upper hand" this week.To stay away from the success bother, Baiocchi proposes entrepreneurs focus on top quality providers, checking out additional selective exchange-traded funds including his organization's O'Shares united state Small-Cap Quality Reward ETF Reveals (OUSM)." The concept is actually top quality business that spend as well as grow their rewards, and significantly, possess much less dryness than their peers," he claimed. "It allows advisors and also clients who have actually seen little caps go laterally for 5 years to become allocated to a group that's dragged." Besides its profits monitor, the fund has just 107 sells u00e2 $" a fraction of what's inside the Russell 2000. Its top 3 holdings are actually Tradeweb Markets, Juniper Networks and also Old State International, each resting at an around 2% weighting in the fund, per FactSet.Shares of the small-cap fund are down 1.5% month to date u00e2 $" exceeding the Russell by much more than 2 percent aspects because time.Disclaimer.