Former BRIC investing darling Brazil is has gone from hero to zero very quickly in the eyes of investors, observes global expert Nicholas Vardy, editor of The Alpha Investor Letter.

After the re-election of President Dilam Rousseff in 2014, the economy started heading south, thanks to a combination of collapsing commodity prices and a social spending binge by the newly re-elected government.

Today, Brazil's bonds have been downgraded to junk status. Its economy is in recession, the worst since 1901. And unemployment is near double digits.

And to add insult to injury, 2016 was supposed to be Brazil's time to showcase its economic achievements, as it plays host to the 2016 Olympic games.

Instead, the Brazilian stock market was the single worst performing stock market in the world in 2015, among the 47 that I follow, down 41.74%.  It is now trading below a 10-year low.

So why am I recommending the iShares MSCI Brazil Capped ETF (EWZ) as my top speculative bet for 2016? Well, I believe Brazil is a classic emerging market contrarian play.

As the late Sir John Templeton observed, "People are always asking me where is the outlook good, but that's the wrong question.. The right question is: Where is the outlook the most miserable?"

Brazil certainly fits that bill. I would add to Templeton's insight my own favorite contrarian indicator.

The cover of the Economist magazine, whose first issue of 2016 featured a negative cover story on Brazil. Such magazine covers have been among the best contrarian indicators I have ever run across. So buy the iShares MSCI Brazil Capped.

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