.The Russell 2000 might possess an earnings problem.Though the small-cap mark gained 10.1% in July, it is actually dropped about 4% thus far in August, since Thursday morning.ALPS' Paul Baiocchi earns the unpredictable transfer to the mark's general arrangement, with a quote from Beauty Global showing 40% of those business have bad earnings." [Clients] have basically surrendered on their own to the truth that by residing in the Russell 2000, I'm just going to have to take the good with the bad," the organization's main ETF schemer said to CNBC's "ETF Upper hand" this week.To stay clear of the productivity drag, Baiocchi proposes capitalists focus on premium providers, taking a look at even more selective exchange-traded funds like his company's O'Shares U.S. Small-Cap Quality Reward ETF Portions (OUSM)." The concept is quality firms that spend and grow their returns, and importantly, possess a lot less volatility than their peers," he said. "It allows specialists and entrepreneurs who have found tiny hats go sideways for five years to be alloted to a classification that is actually lagged." Aside from its own productivity monitor, the fund includes merely 107 supplies u00e2 $" a portion of what is actually inside the Russell 2000. Its own top 3 holdings are actually Tradeweb Markets, Juniper Networks as well as Old State International, each sitting at an approximately 2% weighting in the fund, every FactSet.Shares of the small-cap fund are actually down 1.5% month to date u00e2 $" outperforming the Russell by much more than 2 percentage aspects because time.Disclaimer.