When auction results and price guides don’t help you.....
BryceM
Posts: 11,593 ✭✭✭✭✭
Long read, sorry.....
I happened to be in town with my family and stopped by the Vegas PCGS invitational yesterday & today. At the table of one of my favorite dealers I was shown two separate coins that I was really tempted to buy, but ultimately passed on both.
The first is in a PCGS 67+ CAC holder, has ridiculously nice toning, and was priced at $10k. At 67, CU price guide says $700. At 67+ CU says $2k and at 68 it’s $22.5k. The coin in question previously sold for $15k. Hmmmmm. Virtually all of the coins at this grade level are technically fantastic and most are killer toners. This coin is monstrously beautiful and I thought in three or four tries it would likely upgrade to 68....... but that’s a HUGE paper-value jump and NOT something the graders do every day of the week. Getting a plus is easy. Getting a numerical jump to near top-pop country....... doable, but not a given. Ultimately it sounded like more risk than I wanted to commit that much $$ to, so I passed.
Even in the 67+ holder I know it’s worth WAY more than the average 7+...... but it’s darn hard to value stellar coins between grades at “the jump”. If I had a slightly bigger war chest right now I probably would have bought it. 
The second coin is in an older 63 holder, CU book value $115. It was offered at north of $3k, but had stop-the-presses, no-equal-on-planet-earth, gorgeous (did I say gorgeous?) toning. These coins are almost universally ugly. This one was oh-so-attractive, but was technically graded at 63 due to portrait hairlines/scuffs. In today’s world I’d see it as a technical 64+, possibly carried to 65 by the stupendous toning. It was never tried for a sticker, from a very old collection. CU at MS65 is $1100. I could easily see it getting a gold sticker at MS63.
No guide helps you with decisions like this. Ultimately I passed on this one too, but if I had purchased it, everyone here would have absolutely gone bonkers for it. Again, with a little more free cash, I’d have probably pounced on it.
It was fun to chat with some great dealers, look at great coins at lot viewing, and take my wife to her first coin show of any kind. If you’ve never been to one of these, do yourself a favor & just go. The atmosphere is relaxed, PCGS was handing out 35th Anniversary ball caps, and the food at the Bellagio is incredible. Thanks PCGS!!
One my coin in the auction is tempting me. We’ll see how that plays out.
Comments
I think it really boils down to how much you want it, and what end of the pool you feel comfortable swimming in. Over in the shallow end, we buy coins that book value says $30 but I’ve paid several hundred.
Same premium percentage just shallower puddle to drown in. Been happy with every purchase like that I’ve made for my collection.
Was at the PCGS show today for a few minutes to drop off some coins at grading. Saw some nice coins but was headed to the other smaller show across town going on at The Orleans casino. More my end of the spectrum.
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I struggle with this as well. I'll find an exceptional coin for the grade, but of course the dealer wants multiples of price guide and recent auction results. I always feel like I'll be buried in it if I make the purchase and usually pass.
What is CU??
CU Collectors Universe
Thanks for a great post.
Can't vouch for the food at the Bellagio, but definitely an impressive venue. Too bad I missed the PSGS show by two weeks.
I think that you are looking at the right coins if it is tough to value them. If it was easy then they would be commodities.
I actually see valuing your two examples as requiring completely different logics.
In the first example if your cost basis is $10k and you believe that it will take you 10 tries for an upgrade, that is about $1000 in grading fees plus the final $220 guarantee premium. So $12,200 for a coin you see as being $22,000 with enough tries. Now, you also have the knowledge that someone else paid $15,000 who probably had the same thought and has failed at the upgrade. So I would be inclined to then value this coin at the top end of the 67+ population unless you really back yourself and your grading skills to give you confidence in the 68. If you do, then it is good value at $10k.
The second example is all about eye appeal and not the technical merits of the coin which is limited to a 63. So it sounds like a pretty widget. Someone may very well pay for the bells and whistles, but finding that other guy when it comes time to sell that is willing to pay that premium and recoup your funds will be tough. So this coin I value based on the exit strategy. What is the price I think this clear the market when it comes time to sell and am I willing to take the risk for the premium above the market clearing price for the benefit of ownership.
Latin American Collection
1northcoin, is that Chihuly glass hanging from the ceiling?
CU is Collectors Universe. PCGS is part of CU. Check out the "PCGS Coin Facts" web site for pricing data, population data, photo grading guide, and a lot of other useful information. Definitely a site that's worth bookmarking.
Worry is the interest you pay on a debt you may not owe.
Got cha! I use the Coin Facts app all the time. Just never seen anyone refer to it as CU before. Thanks!
Regardless of how competent and accurate your grading skills, you're taking a huge leap of faith. Odds of it upgrading with that kind of price jump are not worth the risk. The TPGs are well aware of the grade they are guaranteeing and will err on the side of caution.
So, what it boils down to is how confident you are in someone else seeing it as you do.
I have paid multiples of value for nice coins, but very cautiously. I certainly would not pay $10k for a $1k coin especially when someone has already paid $15k and failed at the attempt to upgrade.
Just my eversohumble opinion.
USAF (Ret) 1974 - 1994 - The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries. Remembering RickO, a brother in arms.
The two coins mentioned by Bryce, aside...
I’ve seen numerous comments by posters, stating that the grading companies err on the side of caution when assigning grades that will result in high value coins. However, based oon many coins I’ve seen, I think this view is somewhat exaggerated. There are many high value coins that sharp collectors and dealers feel have been given the benefit of the doubt and which could easily grade lower if submitted for grading out of the holder.
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
Yes, it is. Extremely impressive in person.
So, @Lazybones, when a 67+ (Pop70) is valued at $2k and a 68 (pop 8) is valued at $22k, are there no coins whose proper value lies between the two? What do you do with a 67+ with spectacular toning?? Generally, if you want to own it, you pay up.
When I was more actively collecting Peace dollars I was buying coins all the time in the grey zone around “the jump”. If you watch the auctions, you see coins closing at “in-between” prices all the time. Like I said, no price guide will help you in these waters. Experience, grading ability, help from some trusted advisors, a feel for the whims of the market, and a bit of luck are all that you have.
@BryceM
It's all in the amount of risk you're willing to take. In your particular case, on the one hand you have someone who was willing to pony up $15k with eyes on an upgrade. In the end, he doesn't get what he wanted and the coin ends up selling (somewhere along the line) at a loss. Personally, I wouldn't take the risk on something that has already lost the fight. But that's just me. I have overpaid for exceptional coins before, but never by that margin.
So, I'm not saying you're wrong to do it, I'm simply saying that I wouldn't take that chance.
I wish you good luck regardless!
USAF (Ret) 1974 - 1994 - The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries. Remembering RickO, a brother in arms.
Interesting read into yours (and a few others) thoughts here ... thanks for posting!
I think quite a few coins require judgement decisions on price, and while maybe not as drastic in terms of overall dollars, some are obviously at much higher levels too.
In my opinion a lot of worthwhile coins aren't truly commodities, but are unique in and to themselves. I guess that's why we call them Price GUIDES
Plus, we, as collectors, also appreciate different looks and feels, and value those particulars differently.
Is a dipped white but lustrous and mostly mark free Seated Liberty Half worth the same as the same issue with a thick but attractive russet-grey dirt skin, or the same issue with spectacular rainbow rims fading to off-white original centers?
I know which one I'd pay up for, but it might not be the same one or the same amount extra as you would.
I really like what @Boosibri said:
“We are only their care-takers,” he posed, “if we take good care of them, then centuries from now they may still be here … ”
Todd - BHNC #242
Well at least you had the opportunity to visit a show and do some coin viewing in person. And I can say with a high degree of confidence that at least one or two members here would not have gone "bonkers" for them, myself and Ricko.
My Collection of Old Holders
Never a slave to one plastic brand will I ever be.
Yes, being at a show was fun.
The general sentiment among dealers is that people are hungry for coins and the first big show to open will be pretty darn busy.
Seeing coins in person is sooooooo much better than trying to interpret photos - even really good ones. There’s no better way to pass a few hours than digging through boxes at an auction viewing. I also was able to look at a bunch of coins in the upcoming Legend auction.
Plus graded coins are hard to price with any confidence. Generally, there isn’t a representative number of auction results to make an accurate judgment.
Yes
Apologies too Coinjunkie. Missed your prior responsive post. While at it, apologies to PCGS for mixing up the acronym.