* Investor buying lifts cotton, volume light

* Players taking off for year-end holidays

NEW YORK Dec 19 (Reuters) - - Cotton futures closed higher on Monday after small investors bought in light range-bound business, with analysts predicting a subdued market tone will persist through the end of the year.

The key March cotton futures went up 0.80 cent to close at 87.09 cents per lb, dealing from 85.90 to 87.50 cents. It was an inside day, with trading confined within Friday's 85.27-87.94 cent band.

'It (the cotton market) is completely content to stay within Friday's range,' said Mike Stevens, an independent cotton analyst in Mandeville, Louisiana.

Volume traded stood at slightly over 4,800 lots, more than three-quarters under the 30-day norm, Thomson Reuters preliminary data showed.

Total volume traded Friday stood at 7,021 lots, according to preliminary Thomson Reuters data.

He said fund managers and big investors have probably closed their books for the year and 'are not going to be in a mood to be aggressive' in the cotton market.

Fundamentally, the market is struggling from weak demand caused by fears the debt and budget crisis in the EU and the United States would continue to deflate cotton demand.

Open interest in the cotton market, an indicator of investor exposure, came to 148,427 lots as of Dec. 16, exchange data showed.