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The Basics Of Gradeing


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I thought I would talk about the Nuts & Bolts of gradeing. Basically it comes to one factor, 3 people could have an agreeance on a coin and say EX/Fine, give them another coin with a few nicks or bumps or week reverse strike (Split gradeing)on older coins, and wait and see what they come up with!!Yes gradeing is personal and can be differant from person to person, thats why some coin dealers are members of the ANA or other coin organizations to go by the book as best as possible.I buy from these dealers (In the Past) becouse you have an insurance policy on the coin you might say, they stay within the gradeing structure set-up for the grade, and if you see a differance you have an good return reason. Coin dealers out-side this gradeing membership grade differant, they wil sell you a coin say "Brilliant Unc.", but you will find out its a "Slider"an AU coin!(I really wont buy from these types of dealers)!Iam sure some of you will also dissagree with some graded coins you have encountered,gradeing can be easy or toughf!!but guide lines must be set within the grades and conditions of the coin.

I could make millions if I can comeup with some software that you could lets say preset a coins grade, and then scan another and the software would grade it takeing out the human error possibilities!!, Millions I say!!!!!!!!! :ninja:

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Personally, I think there is a little too much focus on grading in the hobby. Sure, you need to know how to grade to come to an informed value decision when buying. It is an important skill to have. But, to me, that is where the importance of grading ends.

 

Sometimes it seems that the grade of a coin seems to overshadow the coin itself if that makes any sense. I wonder if the obsession with grade (as opposed to just an obsession with nice coins) was as prevalent before TPG's? It also seems that World Coin collectors are much less focused on grade than US collectors.

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Personally, I think there is a little too much focus on grading in the hobby. Sure, you need to know how to grade to come to an informed value decision when buying. It is an important skill to have. But, to me, that is where the importance of grading ends. 

 

Sometimes it seems that the grade of a coin seems to overshadow the coin itself if that makes any sense.  I wonder if the obsession with grade (as opposed to just an obsession with nice coins) was as prevalent before TPG's? It also seems that World Coin collectors are much less focused on grade than US collectors.

 

 

I think I understand what you mean and I tend to agree with you. Further, I would like to add a few other opinion points. .

 

Of course the condition of the coin is an important factor, but for the coins I own and am not interested in selling (and from the collector's point of view, should'nt that include most of the collectable coins out there), the difference between asigning a grade of VF20 and VF35 (or finding out that someone else thinks it is one or the other) are of little consequence.

 

For me, the exponential price function commonly seen from MS64-MS68 is ludicous. I simply will not be part of that and hats off to those who want to play in that game.

 

It is always going to be a matter of some subjectivity, but with an agreement on guidelines such as the ANA guide, most individuals, with a bit of homework and experience, can grade from G-EF with a whole lot of agreement. Look at the functions from the grading challenges on this board - they tend to have a rather small variance.

 

It is so common to see coins being sold that are wildly overgraded that it no longer is noteworthy to me.

 

I will always have some trouble adjusting grading to account for impairments and damage.

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Grading has always been subjective and arguable, even 100 years ago. Back about 1980, Tulving, PCGS, and several other well known firms each had problems with the Federal Trade Commission over grading and investing. They are all in business today because they all signed statements for Federal courts promising not to sell coins as investments and also to agree that grading is subjective.

 

Generally speaking, grading reflects rarity. Coins are made to circulate. Therefore, less circulated examples are less common than those with more wear.

 

Obvious by inspection is the fact that the item with the lesser wear shows the greater detail. That artistic image is one of the reasons why we desire the object. If you randomly removed 1/3 of the Mona Lisa, what would you have? What if you just removed the "high spots" from The Last Supper or Marilyn Monroe -- or for that matter, one-third of the pixels from your CD of your favorite movie?

 

Obviously, grade matters.

 

... but it only matters so much.

 

It matters a whole lot with American coins because they are machine struck clones, each identical to the next, essentially undifferentiable, just a commodity like hog bellies or #2 Heating Oil: one batch is just like the next.

 

I have items that are virtual museum pieces: unique. I am not alone in that. I learned by reading Frank Robinson's Confessions of a Numismatic Fanatic that if you study and specialize and specialize and study, you can own material more rare than a Brasher Doubloon. At that level, it would be nice if the coin (or whatever) were pristine, but, heck, just that it exists at all is amazing.

 

Here is the famous Nike of Olympia.

http://www.sikyon.com/Olympia/Art/olymp_eg08.html

This is the statue that Augustus Saint Gaudens copied his Victory from. Too bad that it is not complete. Would you say that it is not worth anything because it is not Mint State? Heck, it is not even an AU Slider. It might be a Good... Grade it as you will, it is Stunning.

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I thought I would talk about the Nuts & Bolts of gradeing.

 

Here is a procedure.

/Begin:Grading

Pick a coin.

Get The Red Book.

Get the ANA Guide.

Get the PCGS Guide.

Get Browne and Dunn.

Reconcile them.

Assign a grade.

/End: Grading

 

My head is still spinning over the admission by the new ANA grading guide that a VF Buffalo Nickel might not have a Full Horn.

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Generally speaking, grading reflects rarity.  Coins are made to circulate.  Therefore, less circulated examples are less common than those with more wear. 

 

That is, of course, condition rarity and not true rarity.

 

It matters a whole lot with American coins because they are machine struck clones, each identical to the next, essentially undifferentiable, just a commodity like hog bellies or #2 Heating Oil: one batch is just like the next. 

 

In the grand scheme of things, they are of no less significance to history than any other coins from any other country made during any other time. They represent their period in history in the exact same way. It is all in your perspective and your tastes.

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Grading has always been subjective and arguable, even 100 years ago. 

... but it only matters so much.

 

I have argued often against that. To say that it is subjective, literally means totally subjective, and it is not. The point is more than a word style. Once there are agreed upon standards, it has a subjective component and an objective component. In many cases it can be more objective than subjective as evidenced by the greater degree of agreement seen that if grades were assigned randomly - which is what might be expected if it were totally subjective.

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Grading is a demand driven necessity in coin markets. If given the choice people generally will want the nicer coin, especially if the price is the same. This creates more demand on the nicer pieces which increases the price. Usually the supply is limited as well further setting the price. I don't think many people have an issue or trouble understanding the basic concept of greater quality meaning greater price. The confusion sets in when the perceived quality assessment becomes subjective.

 

As has been pointed out grading can be mostly objective. Almost anyone can differentiate a G from a VF from a Uncirculated coin. A little practice and more granularity isn't too hard to achieve, but there are limits. Even the grading services themselves admit that your coin might not get the same grade twice.

 

Another issue is in the objectivity or lack thereof in grading. The grading process is not perfect. On RCC a dealer just posted a thread on a coin and presidential review. Certain people probably have a better chance of getting a good result than others. Then there's the fact that pricipals of PCGS are also dealers. Are they totally neutral? Do they ever get good scoops? Who knows but there's no certainty of objectivity.

 

That doesn't mean things were better before. Fake gold, dipped, whizzed , and altered coins littered the marketplace before certification.

 

The best advice in my opinion is not to spend a premium on grades you do not understand. I can't see the difference between modern proof coins in 68/69/70 holders so I'd never pay the surcharge for a higher number. The same with some price breaks. If a F15 is $10000 and a VF20 is $80000 I doubt I'd ever bring myself to buy the higher graded one since there the difference in quality becomes more subjetcive than objective.

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Thanks Fellas for all your personal input on this.Grade DOES matter when you go to buy the darn thing!, Go to a coin shop and see for yourself (Some shops, not all)they will over grade a VF to a AU!! or a AU to UNC!, I have seen it all the time some years ago when I bought alot.Then try sellin the coins, they will down grade you buddy! guarentee it!So grade does matter when its your $$$ goeing out.

But on the other personal side, Yes I fully agree about haveing a nice original coin VF, EX- F any day !! even for the saveings of big money for those grades instead of higher grades & prices for them, Iam about to make up my mind again about just sticking to buying RAW accurately graded coins instead of the slabed stuff. Thanks eveyone for your thoughts!, Mike.

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In the grand scheme of things, they are of no less significance to history than any other coins from any other country made during any other time. They represent their period in history in the exact same way. It is all in your perspective and your tastes.

 

Ultimately, you are right. Every artifact speaks to its time and place. And at the detail level -- however defined -- no two of anything are "identical." Every coin is unique, by definition.

 

We all have our preferences and prejudices -- and we must respect those we do not share.

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Ultimately, you are right.  Every artifact speaks to its time and place. 

 

In the present, we are usually too busy making history to properly appreciate our own place in it. And, time and distance always make things seem more romantic. :ninja:

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