.The Russell 2000 may have a productivity problem.Though the small-cap index obtained 10.1% in July, it's gone down approximately 4% thus far in August, since Thursday morning.ALPS' Paul Baiocchi chalks up the volatile transfer to the index's general arrangement, with an estimate coming from Beauty Global presenting 40% of those providers have bad profits." [Financiers] have generally resigned on their own to the fact that through remaining in the Russell 2000, I'm merely visiting need to take the good with the bad," the firm's main ETF planner said to CNBC's "ETF Advantage" this week.To avoid the earnings bother, Baiocchi suggests clients focus on high quality business, taking a look at additional careful exchange-traded funds including his company's O'Shares U.S. Small-Cap High Quality Returns ETF Portions (OUSM)." The concept is premium firms that spend and increase their dividends, and significantly, have much less dryness than their peers," he said. "It makes it possible for consultants and entrepreneurs who have viewed little hats go sideways for 5 years to be alloted to a group that is actually delayed." Besides its profitability display screen, the fund consists of simply 107 stocks u00e2 $" a fraction of what's inside the Russell 2000. Its top three holdings are actually Tradeweb Markets, Juniper Networks as well as Old State International, each resting at an about 2% weighting in the fund, per FactSet.Shares of the small-cap fund are actually down 1.5% month to time u00e2 $" outperforming the Russell by much more than 2 percentage points because time.Disclaimer.