Ameritrade Gets Datek, but Not Diversified

Updated from 5:02 p.m. EDT

With the $1.3 billion acquisition of Datek, which was announced Monday, Ameritrade(AMTD Quote) might be putting all of its eggs in one basket when it instead should be considering diversification, some analysts worry.

The merger will boost Ameritrade's market share of the retail brokerage business and should lower costs, but it increases the company's reliance on the active online investor, without adding new sources of revenue, analysts said. That means it's at the mercy of a stock market that may or may not pick up.

The addition of Datek's clients will give Ameritrade the most actively trading customers in the business. In the fourth quarter, Datek investors averaged 23 trades per account on an annualized basis, compared with 12 at Ameritrade, eight at Charles Schwab and seven at E*Trade, according to J.P. Morgan analyst Adam Townsend. ...