Shorting Ambipar (AMBP3)

Insights from a contrarian bet on one of Brazil’s most puzzling stock surges

Recently, I initiated a short position in the Brazilian-listed company Ambipar (B3: AMBP3).

My thesis was straightforward: the anomaly in Ambipar’s stock price was closely tied to the chaos surrounding Banco Master in Brazil. Over the past few weeks, dozens of reports emerged exposing the entanglements of this lesser-known financial institution — and its influence across various corners of the Brazilian capital markets.

One of those connections pointed directly to Ambipar (B3: AMBP3), and indirectly, to the controversial investor Nelson Tanure. Although the links aren't always direct, there are too many strange overlaps and coincidences between Tanure, Banco Master, and Ambipar to ignore.

However, to be clear: my decision to short AMBP3 was not based solely on the Banco Master scandal. The real trigger was the abnormal price movement of the stock.

In less than six months, Ambipar's share price jumped from R$9.08 to R$268.00 — without any solid catalyst or material news to justify such a move. Insane!

That type of rally, in my view, usually signals something unsustainable.

The Short

I opened my short position on June 5, selling shares at R$191.36, and closed it on July 1, buying them back at R$157.00. That translated to a 17.69% gain in less than a month.

While I still believe the stock is severely overvalued and could fall further in the coming months, I chose to lock in profits and step aside — at least for now.

As some market veterans often say: “It’s very hard to sit on the other side of the table from Nelson Tanure.”

I agreed.