Suppose you are a portfolio manager using the capital asset pricing model for making recommendations to her clients. You have the information shown in the following table.

	Expected return	Standard deviation	Beta
Stock A	14.1%	36.1%	0.81
Stock B	17.1%	25.1%	1.51
Market index	14.1%	15.1%	1.1
Risk-free rate	5.1%

1) Calculate the expected return and alpha for each stock.

2) Identify and justify which stock would be more appropriate for an investor who wants to

i. add this stock to a well-diversified equity portfolio.

ii. hold this stock as a single-stock portfolio.