What is one of the key purposes of the NFA established by the amended Commodity Exchange Act?

The National Futures Association (NFA), established by the amended Commodity Exchange Act, plays a crucial role in the self-regulation of the managed futures industry. Self-regulation is important because it helps maintain the integrity of the financial markets, enhances investor protection, and ensures that industry participants adhere to specific standards of conduct and professionalism.

The NFA works to enhance the overall credibility and efficiency of the managed futures sector through a variety of means, including setting rules that govern the behavior of its members, offering educational programs, and conducting compliance audits. This self-regulatory approach allows for more nimble and tailored oversight suited to the unique characteristics of managed futures, which may not be effectively addressed by broader regulatory frameworks.

In contrast, the other options either relate to functions outside the scope of the NFA's mandate or propose actions that do not align with the NFA's objectives. For instance, overseeing all stock market transactions expands beyond the focus of the NFA, which specializes in futures and derivatives. Providing liquidity to the commodities market is generally more relevant to market participants rather than a regulatory body. Lastly, eliminating competition contradicts the principles of a free market and is not a goal of the NFA, which aims to foster a fair and efficient trading environment