The last trading day is the final day that a futures contract, or other derivatives with an expiry date, may trade or be closed out before the delivery of the underlying asset or cash settlement must occur. At the end of the last trading day, the contract holder must be prepared to accept delivery of the commodity or settle in cash if the position is not closed. The same concept applies to options contracts. The last trading day is the final chance to close the position, otherwise the underlying will be delivered if applicable. If the option is worthless, then it does not need to be closed, it will simply expire.
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