Are Price Guides REALLY worth the the Pages they're Pixeled on?
Obiwancanoli
Posts: 1,065 ✭✭✭
I'm always looking at coins online. Ebay, Teletrade (haven't done any business there yet...), Heritage (nor here), and when I come across a coin I'm interested in, I start checking my resources at home, and online, for pricing, grade, the usual "due diligence" approach to buying a coin I'm zeroed in on (apologoes to the dealers and B&M's I haven't bought from yet)...
What I seem to keep coming across is the apparent disparity between price guides - such as PCGS, and NGC - and the actual selling price of a coin.
In my experience, there are some pretty awesome deals going on, every day, every hour... some of which I've benefitted from directly. True, there are others that go for just about exactly what I estimate they will (mostly raw), then again, I'm seeing some PCGS/NGC-graded coins goiing for notably less than the Price Guide's would suggest.
In some cases, I've seen coins going for less than half their estimated (by me) value. And while grading is a skill I continue to develop, I can't be THAT far off when I see coins that at worst, are selling for far less than the so-called price guides would have me believe, even when I purposely lower [my estimate of] the grade a point or two.
One can't help but wonder if everyone bidding a coin in these examples knows something I don't, collectively yet independantly conspiring against the seller, and NOT letting me IN on the secret!!
I'm befuddled.
I realize such pricing issues are typically fluid, and it's not like these guides are absolute in determining a coin's value... I also can appreciate that I may be overestimating the grade of a coin - though as I noted above, I typically discount it for raw coins - but it seems to me I'm seeing a constant display of coins being purchased for far less than their FMV, and I start thinking about how much I'm willing to go into debt to pick up on what appears to be manna from heaven. I'm seeing some apparently great deals out there.
At least, it seems so.
Is the current state of the economy to blame here? Is there a glut, or is this an example of the natural ebb and flow of the price tide of coins, and I happen to tap into a low period?
What am I missing here?
What I seem to keep coming across is the apparent disparity between price guides - such as PCGS, and NGC - and the actual selling price of a coin.
In my experience, there are some pretty awesome deals going on, every day, every hour... some of which I've benefitted from directly. True, there are others that go for just about exactly what I estimate they will (mostly raw), then again, I'm seeing some PCGS/NGC-graded coins goiing for notably less than the Price Guide's would suggest.
In some cases, I've seen coins going for less than half their estimated (by me) value. And while grading is a skill I continue to develop, I can't be THAT far off when I see coins that at worst, are selling for far less than the so-called price guides would have me believe, even when I purposely lower [my estimate of] the grade a point or two.
One can't help but wonder if everyone bidding a coin in these examples knows something I don't, collectively yet independantly conspiring against the seller, and NOT letting me IN on the secret!!
I'm befuddled.
I realize such pricing issues are typically fluid, and it's not like these guides are absolute in determining a coin's value... I also can appreciate that I may be overestimating the grade of a coin - though as I noted above, I typically discount it for raw coins - but it seems to me I'm seeing a constant display of coins being purchased for far less than their FMV, and I start thinking about how much I'm willing to go into debt to pick up on what appears to be manna from heaven. I'm seeing some apparently great deals out there.
At least, it seems so.
Is the current state of the economy to blame here? Is there a glut, or is this an example of the natural ebb and flow of the price tide of coins, and I happen to tap into a low period?
What am I missing here?
UBERCOINER
A Truth That's Told With Bad Intent
Beats All The Lies You Can Invent
A Truth That's Told With Bad Intent
Beats All The Lies You Can Invent
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In contrast; if I'm offered a coin from a series I have no idea on the quality potential, I'll obviously will have no idea what to pay for it, alone knowing if I got the best deal for my money.
Leo
The more qualities observed in a coin, the more desirable that coin becomes!
My Jefferson Nickel Collection
I still use price guides, as exactly that... a guide. Not something chiseled in stone, but something upon which to base my thinking when I don't have any idendependent experience to go on.
The guides are still useful, because they condense the information down to one number. The reality is that a single coin will trade at a wide range of prices, depending on who is buying, who is selling and the venue.
<< <i>What am I missing here? >>
A comparison to stamp value guides.
- Ian
Owner/Founder GreatCollections
GreatCollections Coin Auctions - Certified Coin Auctions Every Week - Rare Coins & Coin Values
If you are trying to buy from a dealer yes.
Shows are WHOLESALE venues and eBay and Teletrade are auctions which by definition are LIQUIDATION sales (often UNDER wholesale) where items are sold immediately for cash with the (supposed) understanding that they are NOT approval sales, and the buyer understands (supposedly) that buying at low prices entails a risk that some of the items may not be the same high quality or selection as purchased retail.
P.S. If I could get anywhere near the prices shown on the PCGS price guide for my PCGS slabbed coins, I would sell 95% of them immediately.
Knowing your series, and it's current momentum will lead to the sweet spot.
Also, what's swimming in the pool?
Are you looking at a pop 12 coin or a pop 120 coin? The latter needs to be special.
<< <i>Price guides, except for the Greysheet, are RETAIL values...the price that would support the normal overhead of selling on TV, a retail store, or handling a mail order business with paid employees, rent, security, taxes, advertising, enough padding to account for market risk, theft, insurance, expenses of credit cards and layaway, markdowns for stale inventory, etc. And hopefully, allow a living wage for the owner.
Shows are WHOLESALE venues and eBay and Teletrade are auctions which by definition are LIQUIDATION sales (often UNDER wholesale) where items are sold immediately for cash with the (supposed) understanding that they are NOT approval sales, and the buyer understands (supposedly) that buying at low prices entails a risk that some of the items may not be the same high quality or selection as purchased retail. >>
I agree with everything Frank said but I think the rational only applies in a perfect world. In truth Ebay/HA is shaping up to be modern wholesale and shows being the closest thing to retail while B&M are fronts for buying and selling non-specialist transactions & socializing with specialists to update their want lists while they congregate even though they have a presence at all major auctions and shows too.
<< <i>
<< <i>Price guides, except for the Greysheet, are RETAIL values...the price that would support the normal overhead of selling on TV, a retail store, or handling a mail order business with paid employees, rent, security, taxes, advertising, enough padding to account for market risk, theft, insurance, expenses of credit cards and layaway, markdowns for stale inventory, etc. And hopefully, allow a living wage for the owner.
Shows are WHOLESALE venues and eBay and Teletrade are auctions which by definition are LIQUIDATION sales (often UNDER wholesale) where items are sold immediately for cash with the (supposed) understanding that they are NOT approval sales, and the buyer understands (supposedly) that buying at low prices entails a risk that some of the items may not be the same high quality or selection as purchased retail. >>
I agree with everything Frank said but I think the rational only applies in a perfect world. In truth Ebay/HA is shaping up to be modern wholesale and shows being the closest thing to retail while B&M are fronts for buying and selling non-specialist transactions & socializing with specialists to update their want lists while they congregate even though they have a presence at all major auctions and shows too. >>
Anybody buying coins on eBay or Heritage and thinking it is wholesale or lower in going to really be diappointed when they sell IMO.
<< <i>I'm always looking at coins online. Ebay, Teletrade (haven't done any business there yet...), Heritage (nor here),
In some cases, I've seen coins going for less than half their estimated (by me) value. And while grading is a skill I continue to develop, I can't be THAT far off when I see coins that at worst, are selling for far less than the so-called price guides would have me believe, even when I purposely lower [my estimate of] the grade a point or two.
What am I missing here? >>
Much of it is about differences in quality. Retail price guides are best used as a reference point for high-quality, eye-appealing coins purchased by an in-person sight-seen buyer. Seeing lots of coins in person is the only way to truly understand quality and pricing, and see why coins of the same grade sell for vastly different prices.
The best way that I know to learn the wide variations in price/quality/eye appeal is to attend a major coin show with a major auction. At the Sacramento ANA, I viewed over 400 coins in the Heritage lot viewing, and found fewer than 25 coins that I thought were worth bidding on, and I won fewer than 10. I saw dozens of lots with good online photos that I had pre-marked to look at when I got to Sacramento, only to find that the in-person quality was sub-par. I'm convinced that the people who own the best coins for the grade and price are the ones who see lots of coins in person at shows and auction viewings, and know what the top 5-10% of quality for the grade should look like. And, if you see a coin at a major auction sell for a "bargain," rest assured that the in-person viewers saw the coin and were not bidding.
This is an online forum, and some folks that pursue the hobby solely online don't like to hear it, but shows and other in-person events are critical to success in the hobby. Spending the hundreds of $$$ to get out of their comfort zone and go to a big show will open their eyes to quality, pricing, and value. It will get them an "insiders" view--worth every penny in my opinion, because they'll be buying coins that will be much more desirable to someone else when you go to sell.
How many times have we, myself included, been underwhelmed by a coin we bought online because we liked the photo? The coin arrives, and there's a little bit of haze or ugly toning we didn't notice, or a fingerprint visible when you tilt the coin, or a few contact marks that didn't catch the light in the photo. I wouldn't immediately say someone got a bargain until I saw the coin in-hand. The wrong coin at a good price is still the wrong coin when you go to sell.
Retail price guides are useful examples of what NICE coins can sell for when viewed in person prior to purchasing. In situations other than this, the coin should often sell for below the price guide.
This holds true for dealers, as well. The really nice coins never sell at bid.
I'm guessing that you are not looking at rare coins.
<< <i>
I agree with everything Frank said but I think the rational only applies in a perfect world. In truth Ebay/HA is shaping up to be modern wholesale and shows being the closest thing to retail while B&M are fronts for buying and selling non-specialist transactions & socializing with specialists to update their want lists while they congregate even though they have a presence at all major auctions and shows too. >>
Anybody buying coins on eBay or Heritage and thinking it is wholesale or lower in going to really be diappointed when they sell IMO.
They are too large a market to apply a blanket statement to as some coins go for a fraction of there value and some go for over. That being said considering that a lot of dealers get a large chunk of their coins coin from these sources, I would call their marked up prices over the auction prices retail
<< <i>
<< <i>Price guides, except for the Greysheet, are RETAIL values...the price that would support the normal overhead of selling on TV, a retail store, or handling a mail order business with paid employees, rent, security, taxes, advertising, enough padding to account for market risk, theft, insurance, expenses of credit cards and layaway, markdowns for stale inventory, etc. And hopefully, allow a living wage for the owner.
Shows are WHOLESALE venues and eBay and Teletrade are auctions which by definition are LIQUIDATION sales (often UNDER wholesale) where items are sold immediately for cash with the (supposed) understanding that they are NOT approval sales, and the buyer understands (supposedly) that buying at low prices entails a risk that some of the items may not be the same high quality or selection as purchased retail. >>
I agree with everything Frank said but I think the rational only applies in a perfect world. In truth Ebay/HA is shaping up to be modern wholesale and shows being the closest thing to retail while B&M are fronts for buying and selling non-specialist transactions & socializing with specialists to update their want lists while they congregate even though they have a presence at all major auctions and shows too. >>
I disagree with most of what Frank wrote. On Ebay and Teletrade most all the buyers are retail, maybe 5% of the volume goes to dealers looking for stock. By definition that makes them retail venues. At most major shows, a patient shopper can find dealers selling most common coins of average quality for greysheet, so the sheet is also a retail price guide. Anyone selling single coins or one proof set at a time is selling at retail no matter the venue.