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Question about the Upgrade Artists and their technique
rhedden
Posts: 6,619 ✭✭✭✭✭
There's been a lot of discussion about upgrading coins that are already in PCGS holders lately. Got me thinking about submitting my "top 25 most PQ coins" for another look. Last time I sent a bunch of already-slabbed coins in 2006, I sent them in old green holders, and PCGS was kind enough to upgrade two thirds of them by a point, but none of them went up two points. However, the question remains as to how the "pro" crackout artists do it. Do they send them in slabs to avoid a surprise bodybag? Do they crack every last one of them and submit raw? Do they crack them, have a coin doctor mess with them, and send them again? 
I'm sure the answer is "all of the above," but what's the current thinking about submitting coins for regrading in slabs vs. raw? Any stories that suggest one is better than the other in recent times?
I'm sure the answer is "all of the above," but what's the current thinking about submitting coins for regrading in slabs vs. raw? Any stories that suggest one is better than the other in recent times?0
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from pcgs website:
How many PCGS experts (graders) review my submission?
Every coin submitted to PCGS for grading is reviewed by a minimum of two and in most instances three or more of our grading experts. Our grading experts collectively have many decades of experience and have graded more than 24 million coins over the past 26 years.
Each grader operates independently and without knowledge of any other grader’s opinions. Each grader records the results of their grading in our computer system which utilizes time-tested rules based logic to determine and track each coin’s grade. After each coin has been graded by the graders it is reviewed and the grade is verified by one of our most senior experts.
Our grading staff has seen and graded almost every major rarity. For a more detailed look at the PCGS grading process you can view the video on the following page: http://www.pcgs.com/services/.
An individual finds a nice coin in NGC MS65 holder with CAC sticker. Total pop at this grade between both services is around 500 with 45 finer. Reasonable market value in this holder is around $3500-$4000. He cuts a deal and buys it for $3,500. The coin looks quite nice and the guy decides it's worth a little gamesmanship. He cracks it out and sends to PCGS where it comes back at PCGS MS65. He sends it to CAC where it fails to sticker (doh! he forgot to take a photo). He now submits it for regrade three times tucked between a really ugly MS65 and a similar coin already wearing a PCGS MS65+ label. On the third try, the coin gets bumped up to a PCGS MS65+ grade. (Total pop at both services 24, with 21 finer). Between the 2nd and 3rd regrade, it was resubmitted to CAC and that time it stickered. The individual keeps a copy of the photo of the slab with the sticker for future use. After the final successful upgrade to MS65+, it's sent back to CAC (with the photos of the sticker on the MS65 slab) and they of course re-sticker it (ignoring the +, per their policy).
The individual finally gets the coin back at a new market value of between $10,000 - $12,000 in a PCGS MS65+ CAC slab.
It sells for $11,000. Total profit is therefore 11,000 minus the original acquisition cost ($3500), four grading fees at the TPG (say around $200), two or three regrade fees for the "setup coins" ($200), three or four trips to CAC for the original coin and the setup coins (around $150), postage ($100 - was likely combined with many, many other coins undergoing the same treatment)....... Total profit for this one coin is $6850. Even if it sold at auction with a 17.5% hit ($1925), there is still a $4925 profit.
Of course, there are risks at each step in this little game. The coin might have had a horrible rim problem not visible in the slab. It might have been given a no-grade due to some unseen issue. It might have required 10 trips to get the plus. Inventory and capital is tied up during the multiple trips to the various gradings services. 80 of the 100 coins submitted that month never did upgrade and the grading fees & postage costs from them ate away some of the profits of the 20 that did.
An insider told me that if 20% come back upgraded, they're turning a profit. Those who have the eye, access to insane quantities of coins, and enough capital to make it go around can earn a nice living this way. It isn't without risk, but there are enough people with grading skills to rival those employed by the TPGs to make it worthwhile.
Who wins? You decide...... Who loses? You decide.... Perhaps it isn't a zero-sum game. At the end of the day, even though it's had four different cert numbers, the little round shiny thing inside the plastic is THE SAME!
This is perhaps a little extreme, but it illustrates what some people do for a living.
How to navigate this environment? Become knowledgeable, find nice coins and buy them when the price is right. Don't be the guy selling PQ coins at lowball prices. Standards & grades might blow around like the wind but quality will endure.
Now, looking to just sell the darn thing and be done with it, he sends it to pcgs to get it reholder-ed/regraded and it came back a grade higher and now worth over 15k!
sometimes these stories are just funny.
Many are former NGC/PCGS graders that know how to spot a under graded coin or one that needs a bit of "conserving" by getting dirt, wax, etc off the coin.
If you're buying random OGH's or rattlers in hopes of a score, you're in for a disappointment the majority of the time.
<< <i>ok - So is it better to submit a coin in a old green holder that's CAC for upgrading or keep the coin in the OGH? Generally, I think that keeping a coin in the OGH is worth more than the coin that's 1 grade higher in a new holder? Currently, I have many coins in the OGH that I could resubmit that I haven't? Is my thinking wrong? >>
There's no set rule for ogh's. If they're fresh coins off the market since 1998 then the odds of picking something nice are much higher. Most ogh's floating around the market and on bourse floors are retreads. Like anything, it comes down to the coin and what it is. An ogh MS65 1881-s Morgan or MS64 Saint won't get all that much attention. But an ogh in say a MS65 bust half might. Unless someone is interested in selling their coins in the next year or so I'd leave any ogh's alone. The market could change radically in the future that might alter how things should get done in the future vs. today. Fresh ogh's that are actually nice or look PQ have the perception that they could bring near next grade money at auction. Thing is, a large % of them will never upgrade. So sometimes just taking the premium is a good ploy as at least you get something more than what the label says.
There's no way that an ogh is typically worth 1 grade higher. I'll take the higher graded coin >90% of the time and you can keep all the ogh's. Unless you're ogh is gold stickered the odds do not favor it being worth more than a coin 1 pt higher. An MS65 ogh with a green sticker doesn't really tell you anything other than the coin is thought to be solid for the grade. It doesn't tell you if it's a 65.4, 65.5, 65.6, 65.7, 65.8, 65.9, 66.0, 66.1, 66.2, 66.3. It could be any one of those...and more often than not, one of those first 3 grades. The nicer PCGS coin (regardless of the PCGS holder's age) is usually the coin that is worth more.