.The Russell 2000 might possess a success problem.Though the small-cap mark obtained 10.1% in July, it's gone down roughly 4% until now in August, as of Thursday morning.ALPS' Paul Baiocchi chalks up the unpredictable relocate to the index's total arrangement, along with an estimate from Apollo Global showing 40% of those firms possess adverse revenues." [Clients] have generally resigned on their own to the fact that by remaining in the Russell 2000, I'm merely mosting likely to must take the excellent along with the negative," the firm's main ETF planner said to CNBC's "ETF Upper hand" this week.To stay away from the profitability pain, Baiocchi recommends investors prioritize premium firms, looking at additional discerning exchange-traded funds such as his organization's O'Shares USA Small-Cap Premium Returns ETF Portions (OUSM)." The tip is actually top quality providers that pay and also grow their returns, and also importantly, have a lot less volatility than their peers," he pointed out. "It enables experts and also entrepreneurs who have observed little caps go laterally for five years to be designated to a type that is actually dragged." Aside from its own success display screen, the fund includes just 107 sells u00e2 $" a portion of what is actually inside the Russell 2000. Its best three holdings are actually Tradeweb Markets, Juniper Networks and Old Republic International, each sitting 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 $" exceeding the Russell through more than 2 percentage aspects in that time.Disclaimer.