Exclusive: Chanos takes profit on his top 2014 short sale - Brazil

NEW YORK (Reuters) - Hedge fund manager Jim Chanos, the prominent short-seller, said Tuesday he has lightened up on some of his bets against Brazil, saying most of the country's downside risk is priced in after the sharp selloff over the past two months.

"Yes, we are still short but we've taken some profits," Chanos said, speaking at a Reuters summit. "I think we'd be crazy not to."

Brazilian stocks have been hammered over worries about the country's presidential election, which incumbent Dilma Rousseff narrowly won on Sunday.

Her victory sent shares plunging as investors fretted about the leftist president.

Brazil's benchmark Bovespa stock index has slid more than 18 percent from early September through its close on Monday. The index is heavily weighted toward miner Vale and state-run oil company Petrobras.

"I think a lot of it is priced in already now" in Latin America's biggest economy, he said to Reuters.

"I wouldn't be jumping wholeheartedly into the Brazil (short) trade here," he said. Nevertheless, he added that he remains short on "a lot of things in Brazil."

Chanos, who specializes in making money when stock prices decline and first cemented his reputation as a short seller with bets against Enron, is the founder of Kynikos Associates.

Chanos has previously spoken about shorting Petrobras and Vale. Both stocks fell sharply on Monday, the first trading day after Rousseff's victory.

Petrobras, which has also been hurt by a corruption scandal and falling global oil prices, dropped 12 percent on Monday. On Tuesday, those shares were last up 3 percent.

Vale, which exports heavily to China, saw its shares fall about 4 percent on Monday. On Tuesday, its shares were last down 0.1 percent.

The Bovespa stock index was last up 2.35 percent on Tuesday.

(Reporting by Luciana Lopez, Sam Forgione and Jennifer Ablan; Editing by David Gregorio)