.The Russell 2000 might possess an earnings problem.Though the small-cap index acquired 10.1% in July, it is actually lost roughly 4% thus far in August, as of Thursday morning.ALPS' Paul Baiocchi achieves the unstable transfer to the index's overall arrangement, with a quote from Apollo Global presenting 40% of those companies have damaging profits." [Real estate investors] have primarily surrendered themselves to the reality that through remaining in the Russell 2000, I am actually only visiting must take the really good with the poor," the agency's main ETF planner told CNBC's "ETF Advantage" this week.To stay away from the profits pain, Baiocchi recommends entrepreneurs prioritize quality business, examining more careful exchange-traded funds including his organization's mountain range O'Shares U.S. Small-Cap High Quality Returns ETF Allotments (OUSM)." The idea is high quality firms that pay as well as expand their returns, and essentially, possess less dryness than their peers," he claimed. "It makes it possible for advisors as well as real estate investors that have observed little hats go sidewards for five years to become allocated to a classification that's dragged." Besides its own profitability display, the fund has only 107 inventories u00e2 $" a portion of what's inside the Russell 2000. Its own best 3 holdings are actually Tradeweb Markets, Juniper Networks and also Old Commonwealth 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 date u00e2 $" surpassing the Russell through greater than 2 amount points because time.Disclaimer.