E*Trade to Acquire PrivateAccounts.com

Updated from 8:15 a.m. EDT

Online brokerage E*Trade (EGRP Quote) agreed to buy PrivateAccounts.com, a privately held firm that gives users direct access to money managers and portfolio information.

E*Trade did not disclose how much it agreed to pay.

E*Trade said its new service will be geared toward affluent investors with at least $100,000 to invest, to independent financial advisors and to corporate clients.

Customers will be able to choose their own money managers and monitor their performance on a daily basis, the company said. E*Trade customers could also receive tax benefits with the separately managed accounts because the money managers can buy and sell securities to maximize the after-tax returns.

"Direct access to professional money managers is a key component of the asset-based services infrastructure that E*Trade will bring to its customers," said Amy Errett, chief asset gathering officer of E*Trade, in a statement. Prior to this deal, such access was only available to institutional investors and individuals with at least $1 million, she said.

E*Trade finished up 3/16, or 1%, at 16 15/16.