What is the difference between Private Equity and Hedge Funds? 

Private equity firms usually acquire entire companies using equity and debt whereas hedge funds acquire small stakes in companies or other financial assets like bonds, currencies, and derivatives. PE firms have more of a long-term focus on the companies they acquire and spend time on management and growth of the companies in their portfolios, while hedge funds focus on benefiting from quick gains in the short term.   

Hedge funds also invest in publicaly traded companies and will sometimes use a “short” instrument to bet against publically traded businesses.  Hedge funds invest in a wider array of assets than Private Equity shops.