[U]Short answer[/U]: [B]Use the ASK price.[/B]
[U]Long answer[/U]:
I don’t know why the Babypips Pip-Value Calculator doesn’t specify which price to use — maybe it’s because it doesn’t make a whole lot of difference, as we’ll see in a moment.
We can compare the results calculated by the Babypips Calculator with the results calculated by the EarnForex Calculator. EarnForex asks specifically for the ASK price of the USD/CAD (using the pair in your example). If we assume an ASK price of 1.3216, both of these calculators return a value of $7.5666 per pip (per standard lot) rounded off. Note that EarnForex returns pip-value results [I]to 15 decimal places[/I] — which is pretty ridiculous for our purposes.
Here are the two calculators, if you want to play around with them:
Pip Calculator: Free Online Forex Pips Calculation Tool for Traders — Babypips
Pip Value Calculator, Pip Calculator, Pip Value Information — EarnForex
Some online pip-value calculators return strange results. Consider the Cashback Forex calculator —
https://www.cashbackforex.com/en-US/tools/resources/pip-calculator.aspx
At first glance, it looks really handy, because you don’t even have to enter a price. All you have to enter is the pair you want to trade, your account currency, and your position size (and whether you want the result per pip — which is the default — or for some other number of pips). Obviously, this calculator is using its own internal prices for all of its calculations.
Okay, let’s try it. We plug in [I]AUD/CAD, 1 lot,[/I] and [I]Results in USD.[/I] The answer given: $7.5586 — not quite the same as the Babypips and EarnForex results. There’s no way to confirm what USD/CAD price this calculator was using. But, by trial-and-error using either the Babypips calculator or the EarnForex calculator, we can determine that a USD/CAD ASK price of 1.3230 yields the result obtained from the Cashback calculator.
The market is closed right now (Sunday morning, about 6am New York time), so maybe that explains the difference of 14 pips in the ASK price of USD/CAD. Every website (and trading platform) is reporting Friday’s closing prices, which often vary widely from broker to broker.
Before we get any deeper into the weeds here, let’s talk about whether small differences matter, when calculating floating pip-values.
Whenever the quote currency in a traded pair does not match the account currency, the relevant pip-value is referred to as a [I]floating pip-value,[/I] meaning that it changes while the trade is open. To use your AUD/CAD example, whenever the price of USD/CAD changes (while this trade is open), the pip-value will change. The opening pip-value and closing pip-value can be quite different.
Given this fact, how important is the difference between $7.5586 per pip and $7.5666 per pip? That’s a difference of $0.008 (8/10 of 1¢). As a percentage of the $7.56 pip-value, it’s about 1/10 of 1%. And, as we already found out in our trial-and-error experiment above, that difference corresponds to just 14 pips in the USD/CAD price. The USD/CAD price can move 14 pips in a few minutes.
I think these small differences in pip-values can be ignored. And maybe that’s why the Babypips Pip-Value Calculator doesn’t even specify which USD/CAD price to enter. But, since you now know that the correct answer is the ASK price, you might as well [I]use ASK prices.[/I]
One final point. For some unknown reason, the Babypips Pip-Value Calculator requires you to enter the current ASK price for the pair you are trading. [I]However, this price has nothing to do with the calculation being performed.[/I] You can prove this to yourself by entering various prices and re-calculating. You will find that you get the same answer, no matter what you plug into that field — provided you don’t plug in ZERO, or leave it blank.
You can even plug in a totally ridiculous price — like 765.4321 — and the Calculator will happily calculate the correct pip-value for you. I mentioned this to Babypips a couple of years ago, but they haven’t adjusted the Calculator.
.