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According to the International Monetary Fund and the World Bank, Brazil has the largest economy in Latin America, the world's eighth largest economy, and the seventh largest in purchasing power parity. Fortunately for U.S. investors, there are plenty of Brazilian stocks that trade on the New York Stock Exchange. Brazilian financial stocks are a great way to invest in this country.

One popular way to invest in Brazilian stocks and have diversification is through the Brazil exchange traded fund, iShares MSCI Brazil Index (NYSEARCA:EWZ), which invests 95% of its assets in stocks, including the financial companies, traded primarily on the Bolsa de Valores de So Paulo. The fund pays a yield of 3.3% based on last year's annual dividend payment and has a one year return of 22.9%.

WallStreetNewsNetwork.com has a list of over 25 Brazilian stocks, several of which are financials. One example is Banco Bradesco (NYSE:BBD), which provides banking and financial services and products to individuals, companies and international corporations around the world. It is the largest insurance and pension provider in Brazil, based on insurance premiums, pensions plan contributions and income from saving plans. With a head office in Osasco, Banco Bradesco has been in existence for over 60 years and is considered the leader in Brazilian lending. Their private sector branch and service network is the largest in Brazil. The company as nearly 3,000 branches across the country and offers services which include Internet banking, insurance, pension plans, annuities, credit card services and free Internet access for customers. In addition to its branches in Brazil, the company has branches in New York, Grand Cayman and Nassau, Luxembourg, Buenos Aires and Tokyo. The stock trades at 9.5 times forward earnings, and pays a yield of 0.6%.

Itau Unibanco Banco Holding SA (NYSE:ITUB) is the result of the merger of Banco Itaú and Unibanco, which occurred on November 4, 2008, making it the largest bank in South America. The company also owns Investimentos Itau. The company has approximately 50,000 employees. Banco Itau provides a wide variety services including small business banking, credit cards, retail banking, asset management, and brokerage products. They have about 13 million customers. The stock has a forward price to earnings ratio of 9.5, and a yield of 0.4%.

Gafisa S.A. (NYSE:GFA) is one way to participate in the Brazilian real estate market. It is one of the largest builders in Brazil and does about 90% of its business in Sao Paulo and Rio de Janeiro. The stock has a forward P/E of 6.3.

Disclosure: Author did not own any of the above.

Source: Top Brazilian Financial Stocks