.The Russell 2000 may have a productivity problem.Though the small-cap index got 10.1% in July, it's lost around 4% so far in August, as of Thursday morning.ALPS' Paul Baiocchi records the inconsistent relocate to the index's general composition, along with an estimate coming from Apollo Global revealing 40% of those companies possess damaging profits." [Entrepreneurs] have actually essentially surrendered on their own to the simple fact that by remaining in the Russell 2000, I'm only going to need to take the really good with the poor," the company's principal ETF schemer said to CNBC's "ETF Edge" this week.To stay away from the profitability burden, Baiocchi recommends investors focus on premium providers, checking out additional particular exchange-traded funds such as his organization's O'Shares USA Small-Cap Quality Reward ETF Reveals (OUSM)." The idea is quality companies that pay out and grow their returns, as well as notably, have much less dryness than their peers," he said. "It makes it possible for advisors as well as financiers who have actually observed tiny limits go laterally for 5 years to be designated to a group that's lagged." Along with its own success display screen, the fund contains simply 107 sells u00e2 $" a fraction of what is actually inside the Russell 2000. Its best three holdings are actually Tradeweb Markets, Juniper Networks and Old Commonwealth International, each resting at a roughly 2% weighting in the fund, per FactSet.Shares of the small-cap fund are actually down 1.5% month to date u00e2 $" outruning the Russell by much more than 2 amount factors in that time.Disclaimer.