The best opportunities in financial markets come when the public's perception of an event diverges from the actual probabilities. One of the markets with the biggest opportunity for this in 2016 is long-dated US Treasuries, suggests Landon Whaley, editor of The Whaley Report.

Investors are currently mispricing what effect slowing global growth will have on the Fed's planned 2016 hikes, and as a consequence, the ultimate impact on US Treasuries. Position yourself to profit when the market finally figures out the realities.

Despite Yellen's attempts to convince markets that US growth is fine and that the risk of global growth bleeding over into the US is limited, the markets aren't buying it.

I know this because 10- and 30-year US yields have been making lower highs for two straight months and both are trading below decade-old downtrend lines.

Likewise, the 3.5% rally in the 30-year bond since the beginning of November is telling us that investors are concerned about the trajectory of global growth.

Despite the fact that some markets are speaking clearly, the smart money speculators are short Treasuries all along the curve and sentiment across the board is extremely bearish.

These speculators have been increasing short exposure in the 30-year bond for the last two years and are more short than they've been in the last five years.

The contrarian in me loves this type of extreme positioning because when this group of speculators, mostly hedge funds, figure out they're wrong, the stampede for the door will cause a massive short squeeze, propelling long bonds higher.

Our Top Pick for conservative investors in 2016 is iShares 20+ Year Treasury Bond ETF (TLT). It's one of the most actively traded ETFs providing ample liquidity.

Don't be alarmed if TLT trades down to the $114-118 area. In fact, that would be the ideal place to initiate new long positions.

A close above the $123.00 area for three consecutive days is the all clear signal for further TLT strength.

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