.The Russell 2000 might have a success problem.Though the small-cap mark obtained 10.1% in July, it's lost about 4% until now in August, as of Thursday morning.ALPS' Paul Baiocchi chalks up the unpredictable moves to the mark's overall arrangement, along with an estimation from Beauty Global showing 40% of those providers have negative earnings." [Entrepreneurs] have actually essentially surrendered themselves to the simple fact that by being in the Russell 2000, I'm merely visiting have to take the good with the bad," the agency's main ETF planner told CNBC's "ETF Edge" this week.To stay clear of the profitability burden, Baiocchi proposes real estate investors focus on quality business, looking at even more careful exchange-traded funds including his agency's O'Shares USA Small-Cap Quality Reward ETF Allotments (OUSM)." The concept is actually top quality companies that pay for and expand their dividends, and significantly, possess a lot less volatility than their peers," he stated. "It makes it possible for experts as well as financiers that have actually observed small hats go laterally for 5 years to become allocated to a classification that's lagged." Besides its own earnings screen, the fund consists of merely 107 stocks u00e2 $" a portion of what's inside the Russell 2000. Its best three holdings are Tradeweb Markets, Juniper Networks as well as Old Republic International, each sitting at a roughly 2% weighting in the fund, every FactSet.Shares of the small-cap fund are actually down 1.5% month to time u00e2 $" outruning the Russell by more than 2 percentage factors during that time.Disclaimer.