Decimal or Plus (+) grading for coins "in between" whole grades numbers

Baley

Does anyone SERIOUSLY not think that PCGS will someday go to an additonal decimal place, or add a Plus (+) for MS coins where a whole point means a geometric change in price? You just can't measure logarithms on a wooden ruler, and this integer system (64, 65, 66, 67, etc) is outdated for high end coins where one whole point means a geometric price change.

I believe that most of the "liner" coins, the ones that are truly in between 2 grades, will someday be slabbed with a grade such as PCGS 66.5, or 66+, and you may even see grades like 65.3 and 65.7, or even something in the format of MS64, +/- 1.5 (multicolor toning) or MS63.5 +/- 0.7 (DMPL obverse, semi PL reverse) because the Market demands it based on the thoughts expressed on here over the past several days especially, and the recent weeks generally.

Such descriptors are necessary when describing a very high end coin, and imo its just a matter of time until PCGS starts using them, again for a large additional fee, and again, only on the highest end coins when a fraction of a point may mean hundreds or thousands of dollars. Yes it would still be an opinion, but it would be both more precise and more accurate than the antiquated system currently being complained about.

what do people on here think? you are the smartest minds in numismatics, you came up with compugrade before, it's a related concept but human graders would do the work. heck, you could get the computer's opinion too, and just average that in with the human judges.

MastaHanky

It'll never happen. People can't consistently grade an unc coin using an 11-point system, much less a system adding an extra significant digit.

RegistryCoin

Two answers: Yes, it is appropriate, given the friction that can be generated with seemingly large disparities in current grades, such as ms66 and ms67, and ms67 and ms68, etc., and, "it's only an opinion" so what's the problem with "exacting" that opinion?

coppercoins

I was thinking something along those terms, but a little more scientific...annotating the actual die state on the slab. Those who spend any time looking at coins with magnification can easily tell the difference between a coin struck by dies earlier in their life, and generally these coins are not only nicer looking but much, much less common than the later die state counterparts. In some ways this is already being exercised, such as the DMPL and PL designations for EDS Morgans...but I think it could be expanded to other coins as well (not something I specifically condone, but it would be a heck of a money maker for the slabbers). Collecting an EDS date set of some series would be a REAL challenge.

Baley

masta hanky, you make my point for me: they can't agree on whether that WHOLE point is there or not, but I think you'll get a lot more agreement with an average grade out to one decimal place for many many liner coins, especially if you also allow a +/- factor of a half or quarter point, because then it would be up to the images of the coin, as well as the tastes of the buyer and seller, to determine which way they lean within the RANGE of values that PCGS would assign to a coin.

am i making my point or being incoherent? I'm on my third jack daniels so i dunno maybe when i sober up it won't seem like such an obvious thing

JML

Compugrade tried it but failed as a business because the field was not ready for it. I still do not think that numbers will ever describe a coin, but as an opinion tool, it has a value. Physical examination will always be critical to collectors.

I believe that Compugrade had the ablility to scan a coin and regardless of the color tell whether that coin had been examined by them before. I also believe that PCGS has that ability. Why don't they use it? It would certainly help with the consistancy.

MastaHanky

<< they can't agree on whether that WHOLE point is there or not, but I think you'll get a lot more agreement with an average grade out to one decimal place for many many liner coins >>

See, personally I think you'd see even LESS agreement. I can see people bickering over whether a coin is a MS63.7 vs MS63.8.

And on liner coins, you'd see people arguing whether is was 63.9 vs 64.1.

But then again, I could be wrong.

Baley

coppercoins, you are absolutely right, the slabs for specialty coins need A LOT more info, info which is now left up to the owners of the coins to find out or not, to believe or represent or not, you have die varieties, different states of the dies, many many post striking things that happen to coins like wear, tooling, toning, damage all kinds of things that an expert opinion is required for more than the simple binary decision of whether or not it "will slab" and an integer from 1-70.

ANACS is on the right track, PCGS and NGC are too, but farther back, and you know, I like SEGS more and more, even if the numbers they assign are sometimes optimistic, i think they tell it like it is in spirit.

Baley

but see, mista hanky, they wouldn't argue so hard if it was 63.9 or 64.1 if there wasn't a
COMPLETELY ARBITRARY JUMP IN PRICE once you crossed the "magic whole number" level.

if you were looking at two coins, a 64.1 and a 63.9, the 64.1 was just a little more expensive than the 63.9, wouldn't you expect the two coins to be pretty close, and wouldn't you choose the one that seemed like the best value? you wouldn't expect the 64.1 to trade at 2x or 5x the price of the 63.9, and if it did, well, easy choice then, no? buy the less expensive coin!

coppercoins

In all actuality the 1995P DDO Lincoln is a pure steal in a slab these days if it's EDS. The typical LDS to VLDS examples are a rip off at the slabbed price of around $50-$75 each. You see, that die lasted for perhaps 5,000 coins MAX in "stage A" EDS before receiving the markers for stage B where it also entered MDS. Stage C and D are common as leaves in a forest with probably close to a million existant examples. Given all that, once the rest of the world wakes up to the actual rarity of EDS coins, the stage A coins from that die will sell easily at $500 and the stage C and D coins will stick around the $50-$75 mark for a long time to come.

So...what'll it be? Stage A with sharp, crisp details shared by only about 5,000 other coins...or....

Stage D with mushy details, separation lines broken or non-existant in areas, dir cracks, scratches, etc with over a million cousins?

And they run at about the same price because they are not differentiated by the generalist collectors and slabbers.

Baley

well there you go, same situation exists in lots of series, I guess the key is hoarding all the special coins and waiting until the demand catches up with supply.

If you could go back 15 years, would you not buy all the DEEP cameo proofs, all the MONSTER rainbow dollars, and all the GEM GEM Full heads, full steps, full bell lines, full split bands, etc etc that you could find?


of course, if you had hoarded bingles, the demand for them still wouldn't have caught up with the rarity, so you need both the low supply and the high demand for the differentiated ones.

tradedollarnut

Baley - you are right. The problem with the inconsistency is money and if you remove the large part of the money by allowing that decimal point, you remove the problem.

But - in my opinion it can't be an average of integer grades. It has to be the average of a decimal grade. If it's the average of an integer grade, a 63.7 could still end up at 63.0 but if it's the average of a decimal grade (or a quarter or half grade) then a 63.7 gets a much closer grade assigned to it. And the idea is to remove the penalty associated with the whole point pricing system.

Note that the relationship between NGC and PCGS in the marketplace has approximated a quarter grade point scale. Take a 64 priced at $10,000 and a 65 at $50,000. A situation like that happens often enough. That is simply too big a spread, but the market has adjusted. A solid PCGS 64 goes for $10k, a high end PCGS 64 goes for $20k, a solid NGC 65 goes for $30k and a very nice NGC 65 goes for $40k and a PCGS 65 goes for $50k. Problem solved.

At least it was - before PCGS upset the applecart. Nobody knows how to price their coins anymore because they aren't always graded to the accepted standard. Now the pricing problem has reared its ugly head again. Is PCGS setting itself up for going to a half point grade from each grader with a decimal point final grade? Interesting............

flaminio

Clearly, there already are "fractional" grades of a sort. Yes, there is the 11-point scale, but within that are further qualifiers like FBL, FS, CAM, DCAM, etc. -- not to mention NGC's stars. So, this makes for many more than just 11 "uncirculated" grades (and price points).

Ultimately, a sufficiently sophisticated Compugrade-style system could grade coins to as many decimal places as the market would bear. The program could have twiddles that ratchet up and down the "strictness" of the grading depending on how much money the slabbing service wants to make and which customers they want to satisfy. Scary stuff...

jom

Look, if you want to REALLY describe a coin do it like ANACS used to do (for MS coins anyway):

1) Luster
2) Strike
3) Marks
4) Eye Appeal (the most difficult)

You can assign 1 to 5 points or whatever. THAT describes a coin which, I thought, is what grading is for, no?

jom

Baley

TDN, I agree that PCGS used to be a fraction of a point tighter than NGC, and that was the idea I was trying to communicate (unsuccessfully, i guess) in a different thread, that the pricing structure at the high end was NGC 65, then PCGS 65, then NGC 66, then PCGS 66, etc.. I now think what the grading industry needs to do FOR HIGH END COINS ONLY, and for a fee, is to have 5 different expert graders assign a grade to a half point, average the numbers, and round THAT number to one decimal place, and express the result with the standard deviation, as 65.3 +/- 0.2 in the case where they give it, say 65.0, 65.5, 65.0, 65.0, 65.5, and would have a higher standard deviation , say 66.6 +/- 0.7, if the graders went say 66.0, 66.5, 66.5, 67.0, 67.5.

see where this is going?

flaminio, qualifiers such as degree of full strike, whether or not there's prooflike fields and/or cameo contrast, stars for exceptional eye appeal, whether a copper is red or brown, all are related, and components of the final grade, so they don't really fall on the one dimentional scale of 1-70, but more like compose another dimention, imagine taking the 70 point scale and moving it sideways, you can see how it describes area and then depth, not just linear thinking.

I do not think the problem is simply lack of additional decimal places, because obviously greater precision without increased accuracy implies a fallacious confidence in the result.

Mrpawn

Few can agree on an 11 point MS scale. Imagine the argumments with a 110 point MS scale!
I am not interested in this circumstance myself and would much prefer the old fashioned "UNC" with descriptive adjectives to decimal grading unless there is a perfected computer grading program. A computer can probably judge disturbed metal and average wear better than most of us BUT - can a computer judge luster? maybe.... Can a computer judge eye appeal? I seriously doubt it - maybe for the programmer, but just like any other canned program it will leave out the variable that matters most...

...Personal preferences of the end user

I may be wrong but computer grading = technical grading alone. Technical grading to a standard that most all agree on is OK with me...but then we will be back to MS(insert grade . decimal) with (insert eye appeal adjective here).

Still not perfect for the investment group because those adjectives can make a huge difference to the end user . ie . the real collector and thus the actual price realized

Personally, I think that the 11 pt MS scale is just fine. Most can evalualate if a coin is close to one end of a particular point on the scale or not and base their evauation/offer on that basis.

I think that most of us collectors can judge a coin by our own personal merit scale and make an intelligent decision whether to buy at the proffered price or not no matter what grading standard is being employed by the professionals.

Baley

mrpawn, the 11 point scale is fine when the prices move arithmetically through them, and adjectives used in communication between the buyer and seller are fine when both know what the heck they're talking about and looking at...

but, and this is a big but, when an MS64 is $3000, an MS65 is $18000, and an MS66 is $60,000
in between coins deserve a more expensive grading fee and a more expert , unbiassed, consensus opinion from a neutral third party grader in order to trade more efficiently.

all the complaints I've read on this board lately with regard to grading are related to the different values the coins are worth in the next whole integer grade, and when the grade scale moves linearly and the values move exponentially, then the market will not be efficient, and people will whine.

ANACONDA

Decimal grading will be a part of the scene in the near future. When is left to the next David Hall and the next big chapter in coins.

Replicability requires it and the natural evolution of many things connected to humans is that of refinement and organization.

Furthermore, consensus grading makes no sense.

Consensus grading is one guy who grades coins with two other guys who advise him. What kind of crap is that? No wonder no one can grade coins consistently

If one guy is really grading the coins, the coins get graded according to one guy's standard.

If 10 guys grade a coin and their opinions are averaged together, the opinions mirror the marketplace. The grades of liberal graders will
be ameliorated by the grades of the conservative graders and the top of the bell shaped curve, which represents the norm, the bulk of
the market and how it determines values, will be the grade assigned.

Instead of one coin being graded 20 times to get maxed out (20 times 30 = $600), and eventually overgraded, coins will be graded
once or twice (2 times 100 = 200) but it will be done right the first time.

An additional decimal point decreases the differences between subsequent gradings.

You guys are smart....think about this. It will eventually settle into the mind of an enterprising individual who takes us to the next level.

adrian

dwood

You're trying to make it a science. Grading is an art, an opinion, with very little scientific basis whatsoever. There is no quantifiable way to assign a grade to a coin under our current system. Take "eye appeal" out of the equation and you get closer, but as long as subjectivity is included, a quantitative scale won't change anything about a qualitative process.

RegistryCoin

<< <i>You're trying to make it a science. >>


I think the opposite is true. I think it will be a simpler system, much easier for graders, better for buyers, and simpler for sellers. I think the room for error will tend to be lessened, and as Adrian mentioned, hopefully to under one half of one point, which is a vast improvement over what we have had or have. (imho)

ANACONDA

" You're trying to make it a science. Grading is an art, an opinion, with very little scientific basis whatsoever. There is no quantifiable
way to assign a grade to a coin under our current system. Take "eye appeal" out of the equation and you get closer, but as long
as subjectivity is included, a quantitative scale won't change anything about a qualitative process. "

I respectfully disagree.

Grading wimmin is just like grading coins. Yes, it's subjective to a point....that's why the more votes on a subjective issue, the more objective (and replicable) the results become.

Some guys like strike (curves) others like skin (luster) others like color. (Do you really need me to place a corollary (sp?) there?) We don't want one person and their biases to grade coins. We want a sample of the educated marketplace assigning grades.

If a drop dead gorgeous woman walks into the room and we all vote, there's gonna be one guy who says, "I don't think she's that
hot." Almost all give her a 9, a few 10s a few lower grades.

If we all vote, the 9 who says she's hot will on average give her a 9.2 (hypothetically). The guy who thinks she isn't hot, gives her a 6
and drops the whole average only to 88.8.

If that one guy is the "finalizer" grading coins when your stunner comes through and he feels like your stunner sucks, like the girl, your
stunner gets a low grade.

If 10 guys are grading your coin, the opinion of that fellow who doesn't like the female stunner or your stunning coin, get ameliorated by the high grades and you end up with a much more valuable opinion.

Do you want to do away with grade inflation? To get a 69 or 70, very few graders, under my proposed grading method, can give the coin less than a perfect grade.

Remember that MS69 Lincoln we saw recently? I saw quite a few ticks on the coin. Do you know how many guys it took to put that coin into a 69 holder and make it worth more than a Mercedes?

Just one. And maybe that coin is worth two Mercedes. But that's not my point. My point is your confidence grows in grading when you know the grades are assigned by 10 guys, not one with two....advisors.

Ask yourself.....ow confident of the grade would you be if 10 guys graded that coin and it got a 69....and all of them graded it independently?

Why you would say: Crane it may have had a few ticks, but 10 experienced numismatists said, on average it was one point shy of perfection. Now that is impressive.

Oh, and by the way.......have you noticed that the grading services have never even addressed a different way of grading? I've never ever seen one article on the evaluation of potential differing methodologies of grading.

Maybe it's because they wouldn't get to grade a coin 20 times.

Someone will come along and start grading coins correctly.

It's just a matter of time.

adrian

jom

How many graders actually see each coin? One? Two? I know they say it's three but do you really believe EVERY 1881-S Morgan they get is run by each grader? Hardly. Even so, to be truly objective you need more than that....10 would be about right. And that isn't happening.

jom

Baley

excellent metaphor adrian!

you know, I think the detractors of the method you describe are thinking it would be applied to ALL coins.

obviously, you don't need 10 independent graders, an average grade expressed to a decimal place, with the standard deviation as a +/-, as well as several strike, luster or color qualifiers for your ordinary run of the mill coins

no, the level of service we're talking about would only make sense for the VERY HIGH END coins, the ones worth so much money as to justify the extra time and effort that would go into grading it, as well as the commensurate fee the grading service would collect.

it WILL happen someday, and probably someday soon.

the spreads on the ultra high end stuff more than justify it, and the market for such material will eventually DEMAND it, heh, if it isn't already!

Mrpawn

I will admit that I am not in the four digit and higher buying market, when I am I think that I will still evaluate the coin in hand - the various price guides - and my desire for that particular coin - as well as the chances of finding an equivalent instead of the one currently available. These factors cannot be measured by decimals. It does not matter if the decimals were derived by a computer or an average of so many expert graders. I personally dread the day that my dealer says " this is a perfect example of MS65.7 for this year in this series by this grading service" or worse" this one is graded 65.7 but I think that is should go 66.1 by today's standards" . If you want to remove the subjective value of having and owning a particular coin and reduce it to simply "this is an X.z grade worth Y money according to this price sheet" then more power to you. That is not my idea of the ideal when it comes to coin collecting - only favorable to investing as far as I can see.

The jump from one common or semi common grade to a grade where the coin is less often available has been and always will be large. I do not care if it is from AU to BU or 63.5 to solid 64. There will always be a gap or large jump in price somewhere in the grading scale. If you are not willing to pay it then don't. My personal favorite grade is AU58 for many coins, good looking coins currently at bargain prices to most MS63 or so that have similar eye appeal and appearance

Investing is OK too. This, to my mind is longer term than buying at one table at a coin show and then moving down the bourse and selling at another for a profit or going to (insert grading co) and getting an upgrade/crossover to increase the value. That is purely speculation and as such carries a great chance of loss as well as gain. I do this myself at gunshows and quite profitably because I know the dealers and who wants what and how much they are willing to pay. I am not a gun collector but a gun dealer. At the few shows that I miscalculate the buying/selling willingness of the other dealers I do not have a grading co to find fault with, only my self and my knowledge of the market.

Anaconda: Unless I have misjudged your inventory, grade does not seem to have much to do with the value of your coins. It seems to me that eye appeal and collector interest have a greater factor - what difference does it make if one or thirty graders give any one of them a numerical grade? It still comes down to a collector willing to pay $X for a certain (individual) coin.

ANACONDA

"Anaconda: Unless I have misjudged your inventory, grade does not seem to have much to do with the value of your coins. It seems to me
that eye appeal and collector interest have a greater factor - what difference does it make if one or thirty graders give any one of them
a numerical grade? It still comes down to a collector willing to pay $X for a certain (individual) coin. "

True, true, true. I don't handle coins in a particular grade, or type....i handle them in a particular category; coins with eye appeal.

With regard to needing 10 graders for every coin.....clearly not necessary.

I would like to see 3 to 10 graders on coins AND TO HAVE THE NUMBER OF GRADERS INDICATED ON THE HOLDER.

Wouldn't that be cool...?????!!!!!!

..........so when someone says "Your coin is overgraded" you can say, well, that's not what 10 PCGS graders say....lookie here!

Now, all you can say is "Well, one person at PCGS disagrees with you.....the finalizer."

adrian

Mrpawn

Currently the "finalizer" that I deal with is the dealer in front of me.

How many dealers want that person replaced by a name on the slab? Or 10?

Sorry, some day I hope to deal with all of you. I hope that when that day comes I hear " I like this coin because......" not " Joe Coingrader says......"

Baley

mrpawn, are you being intentionally obtuse? no one is talking about replacing a trusted dealer.

on the contrary, more precise grading, with some expression of the range of opinons, would simply become a better tool for the buyer and seller to use, a more useful set of data than what we have now;

no one is saying, "eliminate market makers, use precise decimal grading only, and trade all coins sight-unseen" !!!

instead, a certain segment of the market is DEMANDING a better representation from PCGS and NGC.

Mrpawn

Not intentionally

The impression that I have recieved from this and many threads that I have read and/or responded to is for a higher degree of grading standard and how that will help determine the value of the enclosed coin, sight seen or not, for the average coin for the grade.

Wheter this is done by decimal grading or done by a company that currently has better than 85.6% accuracy grading of slabbed coins or some other company or raw it really does not matter to me. If I hold a coin in my hands and make an educated offer to an knowledgeable seller or vise a versa - the grade is only a starting point in determining the final price. Decimals will only in a minor way determine the final price. For the added expense and/or grief it is not worth it to me. It may be to other collectors.

I can see the value for decimal grading in sight unseen and/or investment purchases though.

cladking

The solution is not more grades or fewer grades. Indeed the problem is that
we don't really grade at all- - coins are priced. Years ago there were only two
or three prices for uncirculated coins and now there are eleven. The spreads
between two prices at the high end are getting increasingly large so we need
intermediate pricing.

If we actually graded coins then there would be far more levels of uncirculated
(and circulated) and one would pretty much know what a coin looked like by it's
stated grade. This would make it far easier to compare two coins that aren't in
front of you, and it would allow sight unseen trading for most coins.

Pricing would become much more complicated and would often come down to
the educated opinion of the buyer and the seller. Even here there are methods
which could be used to approximate a price from the stated grade.

dorkkarl

didn't read any but baley's 1st post.

the fallacy here is that you're putting the cart before the horse.

a coin's grade is a derivative of the coin's value, NOT the other way around. & value is determined by the market.

you are still going under the assumption that "grade" is an independent characteristic of a coin. it's the most common misconception in numismatics today.

K S

agfox

A lot of us are already complaining about lack of consistancy and changing standards with the current 11 point scale. If we make it 110 or so points how is that going to increase consistancy?

There are dealers now who can't grade worth a crap using the 11 point scale. I'd hate to see them with more choices! Think about the time and effort to execute such a grading scheam. Back when they went to a 70 point scale the market was not anywhere near the size it's at now, it's a whole new beast and radical changes are not in the best interests of middle and low end collectors. If it's only an extra cost fee for coins worth a substansial amount fine, sure, have at it. But is that putting a disadvantage to those who choose not to have a coin regraded? There's a lot of risk sending a 500k coin into grading you know. You going to dip that 1796 dollar with original toning that's got a nice big thumb print on it now? But it won't stop with just high end coins, middle grade and low grade ultra rares will get it as well.

For the knowledgable collector the current system allows you to cherrypick to some degree high end coins for the grade. You used to pay 65 money for that liner coin now, would you pay 65.9 money for it now? Unless computers are involved I don't see how you could come back to the same grade reliably.

tradedollarnut

I don't think we would have 110 grades. If each grader limited themselves to the half grade the system would work out fine. And, yes, professional graders know when a coin is really nice for the assigned grade. Part of the reason the consistency isn't there is because we are trying to force the grader to put a MINIMUM grade on the coin.

Take a coin that is a very high end 64 for example. Let's say 64.9 for the sake of argument. It goes to PCGS and receives two 64's and a 65. Its final grade is a 64 and the margin of error is 0.9 points. Now we fast forward to the new system. The coin receives two 64.5's and the 65.0 - its assigned grade is then 64.7 and the margin of error is only 0.2!!!!!!!!!!!! All from going away from full point concensus grading to half point average grading.

I also believe that the price guides would become more useful. Instead of these huge, discreet jumps between full grades, with a complex relationship between PCGS and NGC used to approximate a price curve, there would be a truer curve, with ten price points between grades!

I think I like it.

kranky

It's a terrible idea reminiscent of the Emporer's new clothes.

If MS grading could be done with today's 11-point scale accurately, it might be logical to look at further splitting the scale. But since it's clear that there are hundreds or thousands of crackouts being done every month, I see that as evidence we do not have the ability to grade on an 11-point scale. Increasing the number of grades would only the delusion that grading can be done accurately for every coin. If a liner 65/66 coin can be graded either way today, how would calling it a 65.8 magically become the once-and-for-all-time grade? Obviously it could be called a 66.2 just as often. If not, it wouldn't be a liner!

Why are we so determined to weld grade and value together ? They don't have to match up. Yes, it would be much easier on everyone if they did match up, but it can't be done. Even if you had a dozen "65.5" coins, you'd find some to be more attractive (= desirable = more valuable) than others. Mine has 68 surfaces, 62 luster, 66 strike and 66 eye appeal. Yours has 65 surfaces, 66 luster, 67 strike and 64 eye appeal. The two coins aren't the same even if they both get graded "65.5". Even though in real life the four factors are not simply averaged to arrive at a grade, I think you see the point.

Coins with the same grade do not have to have the same value whether we use a 10-point scale, a 70-point scale, or a 1,000-point scale. No two coins are alike, yet we persist in thinking that if we assign two coins the same number, that makes them the same.

Let's see a show of hands of everyone who would begin buying coins sight-unseen if they were graded to tenths of a point. If people won't do that, what does it fix?

Having said all that, I feel certain that the services will begin using half-point or tenth-point grades, because it will bring thousands of slabbed coins back for another trip through the grading mill, and because the registry set people will love the idea.

pmh1nic

The real problem isn't the current system but the huge premiums paid for one point differences in grade. Those premiums force a demand for more accuracy in grading (tenths of points) which IMHO cannot be attained given the very subjective nature of grading.

tradedollarnut

The real problem isn't the current system but the huge premiums paid for one point differences in grade. Those premiums force a demand for more accuracy in grading (tenths of points) which IMHO cannot be attained given the very subjective nature of grading.

Those premiums are never going to go away. There always has been significant demand for the finest. Even most classic coins double in value each grade point. At the upper scale, $50-100k riding on one point is not unheard.

Graders CAN grade to a half a point as consistently as they grade to the full point. In fact, I think they'll do a better job. If they don't have to sit there and say to themselves "I like this coin as a 65, it's better than a 64, but it's got this little tick over here and the price jump is a lot, so I think I can only give it a 64." - but rather can give the coin a more accurate 64.5 which gets average in with two other grades.........

JY93

Imagine what the size of the price guide would be with 110 MS grades. Would there be a big price difference between MS 65.7 and 65.8 I believe there would be and the guy with the 65.7 would believe his coin to be undergraded and would submit it 10 times hoping for the single raise in a decimal point. Seems like we would be right back where we started from.

agfox

But TDN is this another genie to be let out of the bottle? The grading companies would love it, think of all the new revenue on regrades. But where does it stop? two 65.8's held next to each other, one is superior. Is it 65.85 now? Is this about reselling the coins at a higher grade? Pride?

As kranky mentioned these grades were originally used to purchase coins sight unseen. Surely at the level of coins that Baley and yourself are eluding to, sight unseen just does not happen.

Are we worried about the slab or the coin here?

tradedollarnut

I'll illustrate the advantages with a true life example:

A few years ago, I bought a fairly low end PCGS MS64 73CC trade dollar for $54,000. The only MS64 at the time. I grade it 63.8 - I would not want to crack it out of the holder and resubmit it! [Note that all 73-CC's come ugly so the 64 IS a full grade higher than the 63's I've seen]. Then, about a year later, the Vermeule coin came up for auction and Legend bought it raw for about $75,000. It is a full point finer than the PCGS coin - I grade it 64.8 - but the first time thru PCGS it was graded the same as the other at 64. It was then submitted to NGC where it received the 65 grade. The market values a PCGS 64 at about $50k and a PCGS 65 at about $90k. A PQ PCGS 64 would be about $60k, an NGC 65 at about $70k, and a real nice NGC 65 at about $80k. The market is using the grading differences between PCGS and NGC to approximate a smooth pricing curve.

So, at LB the coin was submitted for crossover along with the 63.8 for comparison. David informed me that two graders assigned the 65 grade and three assigned the 64 grade - therefore it didn't cross. PCGS still grades the coin 64.0 because they grade to the minimum full integer. Yet the coin is significantly finer than a coin in the same PCGS grade. IF the graders had been allowed to assign a half grade and the grades averaged, I think the coin would have gotten 3 64.5's and 2 65.0's which averages out to 64.7 - almost exactly correct for what I grade the coin. [BTW - at FUN, David himself acknowledged that the Vermeule coin is "nicer" than the other one]. The other low end 64 would probably receive 2 64.0's and a 63.5 for an average of 63.8 - exactly correct for what I grade the coin.

The advantages are obvious. Under the current system, two coins valued $30,000 apart in the marketplace are lumped together in the same grade by PCGS. That is because they assign a MINIMUM integer grade! Under the decimal system, the coins approximate their true quality and the marketplace would respond accordingly.

With regard to the price guides getting too large, I completely disagree. I think they'd stay exactly as they are now and a buyer and seller would simply interpolate between the two.

jom

<< <i>The real problem isn't the current system but the huge premiums paid for one point differences in grade. Those premiums force a demand for more accuracy in grading (tenths of points) which IMHO cannot be attained given the very subjective nature of grading. >>



Obviously, this is true. But what TDN says is true...this isn't going to go away. But If these graders are consistant to a half point they must be consistant to a full point. And if that's, true then there wouldn't be such as this thread, would there?



<< <i>But where does it stop? two 65.8's held next to each other, one is superior. Is it 65.85 now? >>



Yes, when will the madness stop? The huge premiums won't go away even if you have 4 decimal places. The reason grades such as 64 and 66 were created was to try to eliminate the price speads. That clearly didn't work so there is no reason to believe creating 64.9 or 64.66755 will either.

If you aren't going to go with the DESCRIPTIVE grading system then LOWER the number of MS grades. The price jumps won't go away...they'll probably get LARGER but at least it will be more difficult to crack out. If you have a coin that's "in between" the the MARKET will decide the price.

jom

Baley

JY93,
the price guides would not need to change. most of us are capable of interpolating when the bracketing values are given. how do you price a VF30 when the guide only shows values for VF 20 and EF 40?
and also, we're not talking about 110 MS grades for EVERY COIN. we're talking about a half or quarter point interval between the extreme grades like for example MS65 and MS66 for classics and MS 69 and 70 for moderns, you know, the coins where one WHOLE point means a 2x, 5x, or 10x price change.

no one is going to argue whether it's MS61.1 or MS61.2 if the price difference would be negligible.

AGfox,, you're right, the type of high end coins that this "value added" service would apply to do not usually trade sight unseen... on the contrary, they are now traded with verbal or written descriptions from the buyer to the seller, as to why, in their opinion, the coin deserves a premium (or, far less often, a discount) from the going price for a coin of the grade on the holder.

In an incident where a coin is perceived to be valued at $10,000, when an MS65 costs $3,000 and an MS66 costs $20,000, say with $20 Liberties or pre-1807 type coins, The value added by having an MS 66.5 grade ON THE PLASTIC is that the subjective opinion would be locked in, rather than to have to be specifically communicated and believed by both the willing and informed buyer and seller.

do people really not see this?

and do they think it would go on ad infinitum for EVERY COIN? it would be an extra service, and would only apply when the spread between a whole point is too large to be practical.

tradedollarnut

The main reason for the inconsistencies in the slabbed grading market is because reasonable people can disagree on integer grades. By adding the half point for PQ and averaging the grades to a decimal point, much of that is removed. By lowering the value associated with the next incremental grade (ie: now it's a tenth of a point), the basis for argument is lowered also. Yes, people will still disagree on the grade, but it won't be by a full point anymore, it might be by a few tenths!

Bear

I dont think that Adrian just handles his coins. I see him gently caressing the slab

within they lie. I hear him speaking softly and in loving tones to the beauty that is

within his reach. When he sells a coin its like an adoption process. Adrian has you fill out a

questionaire with questions like: 1 Will you keep the coin in a safe place

2 Will it be humidity and temperature controled

3 Will you protect the coin against all harm
both domestic and foreign.

4 Will you promise to always keep the coin in
a premium holder like PCGS

5 Will you provide a loving environment for the coin.


You dont answer these questions correctly, Adrian wont sell you the coin for adoption.

ANACONDA

Excellent explanation, TDN and Bear!

(Timing is indeed everything! I origninally posted this immediately before bear's post was up. I now have concluded that both bear and TDN are on the money with perceptive explanations. Coins deserve our love and care and they also deserve to be distinguished from each other with decimal grading, especially when some coins in 65 holders are worth 20 times what 64s are worth. And bear, i do indeed cherish my possesssions and care for them as if they were not only my life savings but also my charges!

jbsteven

I am a strong supporter of the decimal point system (either a 10 point or 2 decimal point grades) but I believe the established grading services will not do this as a part of their revenue comes from resubmissions for that point bump. Think if you have a ms66.0 coin would you try and upgrade it? nope If you have a ms66.5 coin then you would much more likely to try a upgrade. This same is true for the 10 point decimal system.

there is no up side for the grading services to do this financially

ANACONDA

Excellent! I hadn't thought about that nuance.

....so if you have a coin, and it's a shot 67, your less likely to re-submit it if it's in a 66.5 holder as opposed to a 66 holder.

So not only do we reduce wild swings in grading (which are bad for everyone) we also lessen the incentive for crack-outs.

Yeah, that is also totally true and you can know it by simply thing about it. No bogus study is necessary to know that!

tradedollarnut

Ahhh... but the short term gain of all those regrades would make it a powerfully attractive idea!

David Hall does not like NGC. The marketplace NEEDS them to approximate a smooth pricing curve for coins that have too high a value between grades. By shifting to a decimal grade, the marketplace no longer needs NGC as much. That's all the incentive that should be needed for PCGS!

But seriously - I'd never downgrade my 64.8 into a 64 holder. But I'd cross it into a 64.8 holder! Think of all the nice NGC coins that would do the same..............

agfox

But is it only going to work for undergraded coins? Surely you're not going to resubmit that 63.8/64 73cc for the lower grade. But what if folks would resubmit looking for buybacks for overgraded coins with the new system? It would be chaos for pcgs. I don't think thier current slab guarantee can handle that. If the don't resubmit it would leave a lot of overgraded coins in slabs. How would you justify that? They aren't making the money on grading classics. They do on the Morgans and Moderns. God, Morgans and Moderns in the same sentence, somebody slap me.

pmh1nic

TDN

"Graders CAN grade to a half a point as consistently as they grade to the full point."

You've got a lot more faith in them then I do.

ANACONDA

But seriously - I'd never downgrade my 64.8 into a 64 holder. But I'd cross it into a 64.8 holder! Think of all the nice NGC coins that would do the same..............

And as soon as every coin worth grading was properly graded, we could stop the 75 day wait at pcgs!

ANACONDA

I'm sure you know that Jim Halperin....a guy David Hall called something like one of the best eyes in the business....ever....has used decimal grading for his purposes, for decades.

adrian
(chairman of the "for what it's worth" department)

Wardhaines

I've thought for a long time that there needs to be a 100 point scale for grading. That would be that same as having decimal points.