Final answer:
The value of both futures and forward contracts increases if the underlying asset's price rises, but it's not possible to determine which is more valuable without specific contract details. Futures contracts have a more immediate value realization because they're traded on exchanges and marked-to-market daily, while forwards are private agreements with value depending on several factors.
Step-by-step explanation:
If you are long a futures or forward contract and the price of the underlying has risen, the value of both contracts would increase. However, the question asks which one would be more valuable. These financial instruments are similar in that they both involve agreements to buy or sell an asset at a predetermined price at a specific time in the future. The value of these contracts increases when the current market price of the underlying asset increases above the agreed-upon price in the contract, which results in a positive value for the holder of the long position.
However, because futures contracts are typically traded on exchanges and are marked-to-market daily, which means the gains and losses are realized and settled at the end of each trading day, they could be considered to have a more immediate realization of value than forward contracts, which are mostly over-the-counter agreements with a single settlement at maturity. In contrast, the value of a forward contract depends on the creditworthiness of the counterparties and the agreement terms. Therefore, it's not straightforward to declare one more valuable than the other without specific details about the contracts' terms, the market liquidity, counterparty risk, and other factors that could affect their respective values.