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Comparing Issue Collectibility Across Grade / Condition Rarity

Using PCGS population and price data, I compared four different U.S. late 19th and early 20th century issues. I sampled 12-15 dates for each of the four issues and for each date identified the grade that corresponded to Top 10 condition rarity, Top 50 condition rarity, and Top 100 condition rarity. From there, I looked at the PCGS price for date and grade combination identified in the previous step. From there, I ran some summary statistics - basically looking at mean and median prices for each condition rarity category (e.g., Top 10, Top 50, etc.). Here's what I discovered: (1) Top 100 $10 Gold Indians trade at a discount to Top 100 $20 gold indians; (2) Top 100 Walking Liberties trade at a premium to $10 Gold Indians; 5c Liberty Nickels trade a discount - period. Some side notes: The cross issue comparisons above control for differences in melt value; there's likely tons of distortion in this analysis given the prevalence of cracking and regrading; the above analysis also assumes that you put stock in PCGS prices. If you're an investment-minded collector, please let me know your thoughts on the above analysis. I'm trying to learn here!

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    JW77JW77 Posts: 460 ✭✭✭✭✭

    You put some hours in this project. FYI, re observation 1, there are no $20 gold Indians. I assume you meant to compare to $20 St Gaudens. My only other comment is that some series are more popular with collectors than other series, which accounts for differences in value.

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    JMoo100JMoo100 Posts: 112 ✭✭

    @JW77 said:
    You put some hours in this project. FYI, re observation 1, there are no $20 gold Indians. I assume you meant to compare to $20 St Gaudens. My only other comment is that some series are more popular with collectors than other series, which accounts for differences in value.

    Absolutely - $20 Saints. Thank you @JW77

    After looking into this, my next question is what drives collectors' interest over time (?). I'm sure there's a healthy amount of animal spirits at play, but I would would put forward the following hypothesis: (1) collector interest probably diffuses over the course of one's collecting career (i.e., new collectors are drawn to well-known issues and price action driven by new collectors responds accordingly).; (2) well-publicized sales of ultra-rare date and condition rarities at auction drive broader collector interest within a given issue (i.e., as we have seen with Saint Gaudens since the sale of the 1933). Would love to hear others opinoins on this matter.

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    CryptoCrypto Posts: 3,390 ✭✭✭✭✭

    Absolute rarity is a much better bet than condition rarity unless it is several grades superior and the under grades are low pops as well. Paying a mint a 68 when 67s are around and many just as nice makes no sense.

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    amwldcoinamwldcoin Posts: 11,269 ✭✭✭✭✭

    You need to consider supply and demand which is hard to quantify. The only way to begin is with auction results. I would wager Morgan Dollars trump pretty much every other series when you consider pops, etc. to others.

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    JMoo100JMoo100 Posts: 112 ✭✭

    @amwldcoin yes, I would agree that Morgan’s have high price given the large supply. That’s the signal of high demand and collector preference for Morgan’s. I’ll run this for Morgan’s next and see what comes up, although will probs have to create a Top 500 Pop category - lol

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    JMoo100JMoo100 Posts: 112 ✭✭

    @crypto so would you rather own a XF I’m an absolute rarity vs a similarly rare condition rarity? How do you think about the trade offs between the two? For example, I’m sure at some point condition rarity might become attractive (vs absolute) if there was enough positive price action for absolutes. At what point would condition become attractive again?

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    RandomsRandoms Posts: 140 ✭✭✭

    Personally I go for absolute rarity over condition rarity. I would rather have a lower grade of a coin that there is a lower known quantity.

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    JMoo100JMoo100 Posts: 112 ✭✭

    Does the same logic apply across dates i.e., situations where a given issue has a single date (e.g., 1921 high relief peace dollar) vs long run at issues (e.g., Washington quarters)?

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    FlyingAlFlyingAl Posts: 2,850 ✭✭✭✭✭

    I believe you will find that those coins with artistically beautiful designs trade at a premium than those without. It seems this is modeled in your results.

    Young Numismatist, Coin Photographer.

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    jmlanzafjmlanzaf Posts: 31,911 ✭✭✭✭✭

    @FlyingAl said:
    I believe you will find that those coins with artistically beautiful designs trade at a premium than those without. It seems this is modeled in your results.

    I think that would be a dangerously narrow interpretation...not to mention subjective.

    Certainly collector taste plays a role in popularity. However there are other factos. For example, coins like 16-D dimes and S-VDB cents carry nostalgia more than aesthetics. Coins like the chain cent carry historical sigificance ore than aesthetics. Personally, I find trade dollars very pretty and morgan dollars to be unattractive, yet the market doesn't agree. And, I know a LOT Of people who don't find Morgan dollars to be terribly attractive.

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    FlyingAlFlyingAl Posts: 2,850 ✭✭✭✭✭

    @jmlanzaf said:

    @FlyingAl said:
    I believe you will find that those coins with artistically beautiful designs trade at a premium than those without. It seems this is modeled in your results.

    I think that would be a dangerously narrow interpretation...not to mention subjective.

    Certainly collector taste plays a role in popularity. However there are other factos. For example, coins like 16-D dimes and S-VDB cents carry nostalgia more than aesthetics. Coins like the chain cent carry historical sigificance ore than aesthetics. Personally, I find trade dollars very pretty and morgan dollars to be unattractive, yet the market doesn't agree. And, I know a LOT Of people who don't find Morgan dollars to be terribly attractive.

    Of course. I was just putting that out there as a factor, and it is not anywhere close to the end all be all. However, the design of a coin does and will play a role in how many choose to collect that coin, amongst other things.

    Young Numismatist, Coin Photographer.

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    winestevenwinesteven Posts: 4,057 ✭✭✭✭✭
    1. As @JW77 said in the first reply, you put a lot of time in on this project. I suggest you smell the roses instead, and do something that you really enjoy, hopefully numismatic related that’s different than this, or even something else.
    2. Your first hypothesis that collector interest diffuses over one’s collecting career may indeed be true with some/many collectors, but absolutely not with me. I’m 71, a lifelong collector, and I’ve never had more fun and excitement than what I currently feel on a project I started last August on putting together a very special and unique Indian Head Cent set. What fun and joy!

    Steve

    A day without fine wine and working on your coin collection is like a day without sunshine!!!

    My collecting “Pride & Joy” is my PCGS Registry Dansco 7070 Set:
    https://www.pcgs.com/setregistry/type-sets/design-type-sets/complete-dansco-7070-modified-type-set-1796-date/publishedset/213996
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    JMoo100JMoo100 Posts: 112 ✭✭

    That’s beautiful. Thank you @winesteven

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    Rob9874Rob9874 Posts: 315 ✭✭✭✭

    @CoinPhysicist said:
    I don’t believe in common date condition rarities period. I think it’s nuts that someone would pay 3x the price to get a 68 over a 67 in a common date. I’d much rather own a serious absolute rarity in AG over an equal price condition rarity in MS68. Every time.

    Absolutely! I'm making up a hypothetical, but if a 1943 Merc in MS68 was the same price as a low grade 1916-D, I'm getting the '16.

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    rickoricko Posts: 98,724 ✭✭✭✭✭

    @JMoo100... That is a lot of work, though I think you enjoyed doing the analysis. I think it is good information particularly for dealers when considering inventory distribution. For casual hobby collectors, such as myself, it is mainly anecdotal. I do have a few coins that qualify as rare, but they were opportunity acquisitions along the way. Cheers, RickO

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    Joey29Joey29 Posts: 458 ✭✭✭
    edited May 29, 2022 10:16PM

    @Rob9874 said:

    @CoinPhysicist said:
    I don’t believe in common date condition rarities period. I think it’s nuts that someone would pay 3x the price to get a 68 over a 67 in a common date. I’d much rather own a serious absolute rarity in AG over an equal price condition rarity in MS68. Every time.

    Absolutely! I'm making up a hypothetical, but if a 1943 Merc in MS68 was the same price as a low grade 1916-D, I'm getting the '16.

    I think the best combination is high condition with high rarity. So a MS 65-66 1916D over a MS 68-69 common date

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    RayboRaybo Posts: 5,273 ✭✭✭✭✭

    Condition rarity is for the registry people, and I will never be part of that unless it's just for pure rarity.

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    Rob9874Rob9874 Posts: 315 ✭✭✭✭
    edited May 31, 2022 10:51AM

    Deleted.

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    messydeskmessydesk Posts: 19,698 ✭✭✭✭✭

    I think you're confusing coins trading at a discount with the fact that the guide you're using doesn't perfectly reflect collector demand.

    Your other question -- what drives collector interest over time -- has a few answers, depending on the groups of collectors you refer to. Individual collectors have individual tastes and tend to follow their collecting goals, and these are often rather niche goals that don't have wide appeal -- even Liberty nickels. ;) The group of all collectors will overall be attracted to things known to be popular, like well-known key dates and flashy, high grades. This is fed by dealers who can help keep these popular, which they'll do if they can make some money on the coins. Well-managed Promotions™ can also come into play. If you look at population reports and price guides, you'll see a lot of stuff that shouldn't make sense that is a result of popularity. 81-S Morgan MS67 with pop 2645/600 higher is $1,100 in the guide, while an 88-O in 65+PL, pop 7 with about 90 at higher grades or PL designations is $1,000. 09-S VDB Lincoln in 65RD pop 930/300 is $7,850 compared to the 18-S in 65RD pop 36/24 at $4,850.

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    ElcontadorElcontador Posts: 7,417 ✭✭✭✭✭

    Just to pile on. Many expensive coins are not rare. You can find a 1916 SLQ in pretty much any condition very easily.

    Where the hobby gets difficult is when you have a large collector base for coins that are genuinely scarce. When you get to pre 1815 coinage, due to this, a number of coins are in slabbed that would otherwise be bagged. I lost count of the number of bleached, lightly cleaned, funky colored Bust Dollars I saw years ago. I've found this to be similar with other denominations of this era.

    "Vou invadir o Nordeste,
    "Seu cabra da peste,
    "Sou Mangueira......."

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