Do graders provide a fair way to compare coins?
DHeath
Posts: 8,472 ✭✭✭
What a hard question to fit in 49 spaces! My question is simply this, do slabs provide a fair way to measure the relative quality of one coin to another? I know there is alot of discussion about a moving standard, and alot of comparison between services, but for the purposes of this query, assume you submit two coins of the same date/denomination on the same day to the same service. Do you feel sight unseen one can determine the relative quality of the two coins from the grade they receive. If it were possible to remove pricing from the market and simply consider quality of the coin, does the present model allow a collector to determine overall quality of one coin to another by the grade on the slab? If your answer is no, then what do you see as the benefit of buying slabbed coins?
Developing theory is what we are meant to do as academic researchers
and it sets us apart from practitioners and consultants. Gregor
and it sets us apart from practitioners and consultants. Gregor
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The question actually sounds pretty simple. It is the answer that is somewhat complex! Certainly, in most(though by no means not anywhere near all ) cases, a coin graded higher than another of the same type, date and mint, will be of higher quality.
However, there is more to it than that. We must also consider who will be examining the coins after they have been graded. If a complete novice, or even someone who is less than highly expert is comparing the coins, he might not be able to see what accounts for a legitimate difference in the quality and assigned grades of the coins in question.
In other words, let's say that collector x is looking at two $20 Liberty pieces, graded MS63 and MS65, respectively by PCGS or NGC. And, for the sake of this discussion, let us stipulate that the top 10 graders in the world all agree with the assigned grades. It is still possible that the collector will not be able to tell which is the superior coin, simply by comparing the two. Perhaps the MS63 piece has a great look, but is covered with fine hairlines which the non expert can't even see. And, maybe the same non expert can easily see some abrasions on the MS65 piece (which are not present on the hairlined MS63 coin), which causes him to think the MS63 piece is superior to the MS65. I have seen such situations quite often when I have taught the ANA Advanced Grading class. I have also seen far too many instances where collectors or dealers complained about their coins being undergraded, when in fact, they simply failed to notice or recognize problems on the coins which the grading service obviously caught.
It takes both accuarte grading AND informed/knowledgeable people who look at the coins once they have been graded, for someone to be able to appreciate and understand the relative differences in quality between coins.
Should I change my user name to "Longwinded"?
a fingerprint. It has several specific attributes which could be graded on a scale,
but the hobby has always rejected this idea. We prefer instead to have our coins
assigned a value denoted by a number from 1 to 70 and a catalog. It is hence im-
possible to call one coin better than the other of the same grade. Indeed even if
one is "graded" much higher it isn't possible to say that it is better quality. It is pro-
bably more valuable if they are both accurate "grades" but higher quality is a judge-
ment call and some would find the well struck MS-64 superior to clean MS-67 with a
strike weakness.
The benefit of slabbed coins is that several experts have agreed that the coin is
worth a specified amount of money so one has some protection from those who
would foist a coin as being more valuable than it is.
There should be 120 characters maximum in the title line.
For me, I don't want to pay any premium for toning, and I like nice luster. So if a coin is a 66 because it got a one-point bump for toning and a great strike carried run-of-the-mill luster, it's not worth 66 money to me. Other people would see it differently.
But the benefit of slabbed coins to me is authenticity, a guarantee that the coin is genuine and hasn't been tooled or altered. Also, being able to shop AU58 slabs helps me find really nice coins with a sometimes indetectible rub at a great price. I don't trust myself to detect sliders if the coin is raw.
New collectors, please educate yourself before spending money on coins; there are people who believe that using numismatic knowledge to rip the naïve is what this hobby is all about.
and it sets us apart from practitioners and consultants. Gregor
Just kiddding (about the "the end" part)
I don't recommend that anyone buy coins site-unseen - there is lots of downside and there are plenty of opportunities (coin shows, dealers with return privileges, good images, etc.) to buy them on a site-seen basis.
Regarding your question "aren't eye-appeal and technical grade two seperate things?" - my answer is, yes and no. In theory, they might be two different things. However, PCGS and NGC both take eye appeal into account when grading coins and I believe, rightfully so.
Eye appeal is one of the components of a coin's grade. So if a coin has great eye appeal (resulting from dazzling luster or great color, for example), the grade might be bumped up a point, or even two points. There are many coins with gorgeous toning that clearly, are graded 1 or 2 points higher than they would have been, were it not for that color. Simply put, beauty/eye appeal often results in higher grades and therefore, higher values/prices.
Camelot
As an aside - Mark, since you taught ANA's advanced grading class, what are the most common oversights for intermediate graders? Also, do any of you guys believe there is any "standard" for how cam designations are applied that would be useful to the collector?
PS - Kranky, I really liked your thread on this topic and your classroom experience. It was one of the most useful posts I've read on these boards.
and it sets us apart from practitioners and consultants. Gregor
I agree with Coinguy because when one looks at the 63 and the 65 one may very well like the 63 better because of it's color or strike (or smaller price?). Is the 65 worth more? MOST of the time but it may be "worth" so much more to collector X that they may actually want the cheaper 63. It just depends on the coin.
So to answer the original question: You can't really determine ANYTHING sight-unseen. Probably not grade must less QUALITY.
jom
Sight unseen is tough, but isn't that what the services are hoping to assure us of?
and it sets us apart from practitioners and consultants. Gregor
I won't be surprised if Mark answers your question about the most common oversights with something you already mentioned - hairlines. I have a 32-S Washington quarter in a 61 slab that looks a lot better. In fact I showed it at the grading class to one of the graders (not Mark) with the grade covered over. He looked at it and said "Hey, that's really nice! I'd say it's a 65 or maybe 64." But he looked pretty quickly and missed the hairlines. Obviously if he was grading the coin for real he would have caught them. My point is that the coin looks really nicer than a 61 but probably isn't.
Personally I wonder why hairlines hurt so much in a case where you have to tilt the coin at one particular angle to see them at all. But it's clear to me that they count a lot, so it's important to make sure you can see them. But to me they are counted disproportionately to their effect on eye appeal. And on the other hand, there are probably a lot of people who would say the same thing about strike, or luster, or whatever.
New collectors, please educate yourself before spending money on coins; there are people who believe that using numismatic knowledge to rip the naïve is what this hobby is all about.
condition? Why don't we just grade our coins on their attributes and then slam the grading companies
for their value opinions? At least we'd know what the coins looked like before we saw them- - mostly.
"As an aside - Mark, since you taught ANA's advanced grading class, what are the most common oversights for intermediate graders? Also, do any of you guys believe there is any "standard" for how cam designations are applied that would be useful to the collector? "
Some of the most common oversights were missing hairlines (already mentioned by Kranky), light cleaning or wiping; focusing too much on one flaw or imperfection and ignoring the positive attributes of the coin in question; giving too much credit to a coin that had numerous small flaws (none of which stood out in particular) compared to a coin that had fewer flaws (one of which might have been more noticeable; using a magnifier right off the bat - I believe that you should take at least a quick look at a coin to get a general feel for its quality, appearance and eye appeal, etc, before you use a glass. I also see a lot of people use improper and/orinconsistent lighting- a big no no! For the record, I believe I should point out that, while the class was caled "advanced grading", that name was more of a reference to compare it to the beginner's class - there were certainly numerous non-advanced graders in the class, though everyone seeemd to improve noticeably in the 3 days I was there (and presumably more so, in the follwing days).
Regarding the cameo designations - personally, I feel that (unfortunately) such designations can be as subjective as the grade itself and only gives us more things to argue about.
And in condition-rare series, they are also invaluable for the pop report data which can show general trends of condition-rarity.
Beyond that, asking them to consistently give the same grade to a given coin on a 70 point scale, or to assume that higher graded coins are always nicer than lower graded coins, is asking too much.
So, in other words, a great tool for getting in the ballpark. But you still gotta hit the ball yourself. Or something like that.
and it sets us apart from practitioners and consultants. Gregor
An individual may use those figures to get a general idea of the supposed quality of a coin, but that should be all the faith you put in those numbers.
I'm a little confused about that. Didn't David Hall contend that professional grading would make coins kind of a commodity that could be viewed as an investment vehicle? I didn't realize that would mean wholesale transactions only.
and it sets us apart from practitioners and consultants. Gregor
If I recall correctly, PCGS (and later NGC) were originally supposed to facilitate sigh-unseen trading of coins, especially for all the "Wall Street" money that was supposed to come into the coin market in the late-80s.
However, I think that claim disappeared pretty quickly - about as fast as the Wall Street money that didn't come into the coin market.
Check out the Southern Gold Society
for me it is becoming a raw market again even moreso with slabs because of the sophication of the collector with an eye to quality and eye appeal!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
the grading services have fostered this and are great and this gives you a starting point for coins that are ok for the assigned grade and genuine and problem free ...................most of the time slabbing
gives you a guaranteed market price with the bluesheet and some guarantees as to grade and price or thereabouts
they are very close sometimes farther apart
NOW HERE COMES THE MOST IMPORTANT THING AS BELOW
but then you have to look at a coin and see waht you think eye appeal wise and many other considerations
AND make a decsison for yourself
i will admit that for most the slab is a comfortable starting point but then you must take it a step further and refine it evaulate the coin super closely
that is why some supposedly identical coins in the same holders with the same grades and the same coin mintmark/date/variety wise etc sells for HUGE DIFFERENCES!!
when you look at a coin in a holder in the end when all is said and done it is your decsison as to what the coin is ...................... TO YOU!
sincerely michael
K S