.The Russell 2000 might have a productivity problem.Though the small-cap index got 10.1% in July, it is actually fallen around 4% thus far in August, as of Thursday morning.ALPS' Paul Baiocchi achieves the inconsistent transfer to the index's general arrangement, along with an estimation from Beauty Global showing 40% of those companies have bad earnings." [Investors] have actually generally resigned themselves to the fact that through remaining in the Russell 2000, I'm just visiting must take the excellent along with the negative," the company's principal ETF strategist informed CNBC's "ETF Advantage" this week.To steer clear of the productivity pain, Baiocchi suggests entrepreneurs focus on premium business, considering more careful exchange-traded funds such as his company's mountain range O'Shares U.S. Small-Cap Top Quality Reward ETF Allotments (OUSM)." The idea is actually high quality companies that spend and also increase their returns, and also essentially, possess a lot less dryness than their peers," he pointed out. "It permits advisors and investors that have observed tiny limits go sideways for 5 years to be designated to a category that is actually delayed." Along with its own success display screen, the fund includes just 107 sells u00e2 $" a fraction of what is actually inside the Russell 2000. Its top 3 holdings are actually Tradeweb Markets, Juniper Networks and also Old Republic International, each resting at a roughly 2% weighting in the fund, per FactSet.Shares of the small-cap fund are down 1.5% month to date u00e2 $" outshining the Russell through greater than 2 portion factors during that time.Disclaimer.