Final answer:
To close out a short position in a gold contract with December maturity, one must perform an offset trade by buying back an equivalent gold contract for the same month, thus covering the original position and locking in any results.
Step-by-step explanation:
If you are short one gold contract with a December maturity and wish to close out the position, the offset trade you should make is to take a long position in a gold contract with the same maturity. When you buy back the same amount of contracts for the same month, you are effectively nullifying your original short position. This process is often referred to as covering your short position. In most futures markets, including commodities such as gold, the contracts are standardized, and traders can close their positions by performing the opposite action of their initial trade. The purpose of this offset trade is to lock in any gains or losses and remove the obligation to deliver the underlying asset at contract maturity.