Net grading - how to determine?
nwcs
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When you have a coin that has been whizzed or badly dipped, whatever, and need to net grade it, what are the rules? I've seen things like AU DETAILS NET VF for example. How do you determine the net grade?
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the most common mistake is to think you have to figure out the net-grade first, then the value in $. that is the opposite of the correct procedure!!!
this is a subtle & very underrated issue, but an extremely important 1. i seriously hope this helps, will be glad to offer more if you have any other questions.
terrific question, the thread will probably be under-appreciated.
K S
So what I do is say I wouldn't pay more than AG/G money for it so that is its net grade, right?
dorkkarl makes a very good point, you have to decide what you are willing to pay for the coin. The reason why the coin is net graded may or may not bother you.
ie. cleaning may require a larger discount for some collectors over others to purchase the same coin. It becomes a matter of taste. Cleaning has never bothered me as long as the coin doesn't look like it has been dipped in acid.
So, I might be willing to pay more than the net grade because it doesn't bother me as much as someone else.
Joe.
In light of what you all are saying, I think I like NCS's way of just listing problems and the details the coin shows. Sounds like it's a "decide for yourself" kind of thing.
YOU might say "it's a nice coin , but i just can't tolerate scratches. i'd give 20 bucks for it", & according to the redbook, $20 is the value of XF. so for you , the coin net-grades XF-40.
now, I might say "yeah, it has a scratch, but big deal, i need that date, & besides, the reverse won't show in my whitman folder anyhow. i'd give $75 for it". if the redbook value of $75 falls under the ms-60 column, then I net-grade the coin as ms-60.
what i believe anacs will do is grade the coin as if it had no prob's 1st. then, they probably have a reference list that says
cleaned - deduct 10 points
whizzed - deduct 15 points
holed - deduct 25 points
bent - deduct 5 points
small scratch on obv - deduct 5 points
large scratch on obv - deduct 10 points
large scratch on rev - deduct 5 points
and so on & so forth. this approach tries to satisfy a "happy medium", but is really useful only in relative terms. ie, given 2 coins with identical details but vastly different problems, the one w/ the higher net-grade would presumably have fewer problems.
the NCS approach works EXCEPT that it gives no indication of the "magnitude" of the problem, relative to other identical coins w/ similar prob's.
does that help a little?
K S
good luck!
K S
Here's an example for you. The finest known and sharpest 1798, NC-1 large cent has been net graded to VF-20. Six examples of this variety are known; they are not bought and sold frequently; and the value is speculative.
The coin in question has EF-40 sharpness by EAC standards (AU-50 by other people's standards) but it has a long and very deep scratch in the right obverse field. What if a clean VF-20 were to come along? Which would be better? A lot of copper collectors would prefer the clean VF-20. What if clean a Fine-15 were discovered? Would the collector who found that coin have a claim to say that he had the finest because he thinks that 20 points is not enought of a penalty for a mark that would make a common coin a cull?
This is why net grading is not that easy.
Here's another one. A couple years back there was an 1875-S/CC trade dollar listed as "AU details, net VF-35" because of a chopmark. Heritage started bidding around the VF price, but it finally sold for AU money. Why? Because it is one of the rarest chopmarked trade dollars, so it was worth about the same with or without the chopmark in AU. If it would have been a VF coin with a chopmark net graded F-12, it would have been worth MORE than VF money. On the other hand, if the coin had been a scratched coin net graded VF-35 with AU details, it may not even have brought VF money. One man's "damage" is another man's treasure.
It is indeed complicated.
Obscurum per obscurius
I can form my own opinion as to how bad any damage or problem is and pay what I feel is an appropriate price based on the problem as I see it.
I would much rather buy these new NCS slabs anyday over an ANACS net slab.
however, it is absolutely true that if you try to grade for the masses, as any plastic company does, you immediately violate the principle that all grading is SUBJECTIVE.
also note that my definition of net-grading is also consistent w/ those rare coins that appear only once in a while. why? because i am allowing for the grade of a coin to change over time. again, that is part of the subjective aspect of grading. your opinion on what may or may not be desirable, and to what extent, is allowed to change over time.
of course, the underlying principle for the whole net-grade topic is that net-grades were DEFINED by Dr. Sheldon as being reflective of the value of large cents to begin with. ie. if a basal state coin worth was worth $1, then G-4 was worth $4, and XF-40 worth $40.
guess i'm just trying to say what works to me, & in fact i feel very strongly about it. it's why i constantly rail against slabs, because they completely violate my 1 constant principle, that a grade is SUBJECTIVE , & in truth cannot be certified any more than you can certify what constitutes art, and what does not.
<< <i>Using the price guides to match the price one would pay with the grade ... (has) flaws ...it doesn't help a bit, especially if the coin in quesiton is rare and seldom traded.... example ... The finest known and sharpest 1798, NC-1 large cent has been net graded to VF-20. Six examples of this variety are known; they are not bought and sold frequently; and the value is speculative.
The coin in question has EF-40 sharpness by EAC standards (AU-50 by other people's standards) buy it has a long and very deep scratch in the right obverse field. What if a clean VF-20 where to come along? Which would be better? A lot of copper collectors would prefer the clean VF-20. What if clean a Fine-15 were discovered? Would the collector who found that coin have a claim to say that he had the finest because he thinks that 20 points is not enought of a penalty for a mark that would make a common coin a cull? >>
but you see that this is just my point. you even used the phrase "finest known", to which i would respond "to who?" that in itself is subjective! and YES, the grade WOULD change if the entire population were suddenly shifted by a discovery hoard. you will never hear me use the phrase "finest known", because again, that is a matter of opinion.
<< <i>another one. A couple years back there was an 1875-S/CC trade dollar listed as "AU details, net VF-35" because of a chopmark. Heritage started bidding around the VF price, but it finally sold for AU money. Why? Because it is one of the rarest chopmarked trade dollars, so it was worth about the same with or without the chopmark in AU. If it would have been a VF coin with a chopmark net graded F-12, it would have been worth MORE than VF money. On the other hand, if the coin had been a scratched coin net graded VF-35 with AU details, it may not even have brought VF money. One man's "damage" is another man's treasure. >>
this is a case where "grade" is not the issue. they are different coins. ie. there ought to be 2 separate lines in a price guide for 2 different coins, 1 w/out a chopmark, 1 with. by the fact that you are collecting that attribute of a coin ("chopmark"), it is NOT a grade determinant. that would be like saying "this dime was struck on a cent planchet, so it must be net-graded down 10 points due to damage".
K S
Among dealers there are grading standards that go beyond subjective, and you had better learn them if you are in business. The alternatives are to leave the business or become a “flea market dealer,” which in the trade is a term of contempt. Determining grades is essential to setting values. If you can’t grade coins, you can’t begin to appraise their value.
ie. i can afford the luxury of how i'm net-grading coin per my definition above, but i'm not buying for profit. you don't have such luxury, as you by definition have some motive for profit. note that i'm not saying this in a negative way whatsoever, it's the way the dealer/collector relationship should be.
note also, that i'm not advocating grading ALL coins that way (though it is in effect how standards are established), but the issue raised concerned coins w/ damage.
i appreciate your dealer's point of view on this forum.
K S
although I did buy my CT Terc raw for 63 money and it slabbed pcgs 65
Go BIG or GO HOME. ©Bill
this is a 15 pt variation, which makes pcgs look foolish in a way. if they did their grading anacs/ncs style, they might have said "au details, repaired field" which would have been more useful then just a generic number. but i guess the did that to protect their "overgrading" guarantee.
K S
I prefer to describe the details and the problem, remove the terminology of net-grade from my vocabulary, and let the chips fall where they may.
I've not had a really nice early sivler dollar in quite a while. The last one I had was a 1798 in PCGS EF-45. It was totally original and very choice but it did have adjustment marks. At the time I bought it I paid $1,500 when the EF "bid" price was $950. I sold it to another dealer for $1,650 who was after me for more similar coins a month later. That indicated that he had made out quite well on that deal.
I had only taken a quick look at the picture since I was not interested in purchasing the 1794 dollar. I did not realize that it had been repaired. I thought it looked really nice for a VF-30 graded coin. Now I understand why it had so much "meat" (detail) and was only graded VF-30
K S