.The Russell 2000 may possess a productivity problem.Though the small-cap mark obtained 10.1% in July, it's gone down about 4% up until now in August, as of Thursday morning.ALPS' Paul Baiocchi achieves the volatile relocate to the mark's total composition, with an estimate coming from Apollo Global presenting 40% of those business have unfavorable incomes." [Entrepreneurs] have actually primarily resigned themselves to the truth that through remaining in the Russell 2000, I am actually merely heading to must take the really good along with the bad," the agency's principal ETF planner told CNBC's "ETF Edge" this week.To steer clear of the earnings burden, Baiocchi recommends investors prioritize quality firms, looking at additional careful exchange-traded funds like his firm's mountain range O'Shares U.S. Small-Cap Quality Dividend ETF Allotments (OUSM)." The idea is high quality business that pay as well as develop their rewards, and notably, have much less volatility than their peers," he claimed. "It permits specialists as well as real estate investors that have observed little caps go sidewards for five years to be allocated to a category that's dragged." Aside from its own earnings display screen, the fund includes merely 107 inventories u00e2 $" a fraction of what's inside the Russell 2000. Its own top 3 holdings are Tradeweb Markets, Juniper Networks and Old Republic International, each sitting at an about 2% weighting in the fund, per FactSet.Shares of the small-cap fund are down 1.5% month to time u00e2 $" outperforming the Russell through more than 2 portion factors because time.Disclaimer.