<p>The talk of hedge funds in the African investment space can excite crafty investors and anger those with development agendas, but private equity probably did the same thing a decade ago.</p> <p>Short-term volatility and uncertainty in the African growth story create&nbsp;opportunities for hedge funds. Hedge funds are generally authorized by their investors to operate under more flexible mandates than private equity, and they have the creativity to generate bond-like returns that outpace inflation. Critics will say hedge funds operate with limited liquidity in an opaque world.</p> <p>Private equity is a similarly illiquid class to hedge funds &mdash; yes, it is clearly less opaque &mdash; but let&rsquo;s not get hung up on the details.</p>