Last trading day

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Last trading day

The final day under an exchange's rules during which trading may take place in a particular futures or options contract. Contracts outstanding at the end of the last trading day must be settled by delivery ofunderlying physical commodities or financial instruments, or by agreement for monetary settlement, depending futures contract specifications.

Last Trading Day

1. In options, the expiration date.

2. In futures, the last day on which a contract may be traded. After the last trading day, whoever holds the contract must either take delivery of the underlying assets or agree to settle in cash.

last trading day

1. The day on which a trader must liquidate a futures position or else be required to receive (if long) or make delivery (if short). Following this day, the particular contract will cease trading.

2. The last day on which a particular option is traded. Currently, this day is the third Friday of the expiration month.

Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

Last trading day.

The last trading day is the final day on which an order to buy or sell an options contract or futures contract can be executed.

In the case of an options contract, for example, the last trading day is usually the Friday before the third Saturday of the month in which the option expires, though a brokerage firm may set an earlier deadline for receiving orders.

If you don't act on an option you own before the final trading day, the option may simply expire, or if it is in-the-money it may be automatically executed on your behalf by your brokerage firm or the Options Clearing Corporation (OCC) unless you request that it not be.

But if a futures contract isn't offset, the contract seller is obligated to deliver the physical commodity or cash settlement to the contract buyer.

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