Grading and buying gold coins for your collection

Bear · June 15, 2011 3:42PM

It seems that gold being a rather soft metal, did not hold up well even

in MS condition. Merly bagging the coins or stacking the coins caused

many distracting marks on the coin.If you compare the marks on many

MS-65 and 64 gold coins, they generally do nor compare favorable with

the similar grades in the silver series. Because of the softness of the

metal, obviously some extra latitude had to be made in grading. There fore

the plus grades are often a must unless you go up to MS-66 0r 67 grades.

I have found, that by careful looking, lower grades in nice condition can

be found where the luster is good and the marks are not in suck

prominent places.While personal taste and a person's own standards play a role,

I must warn you, when you go to sell your gold some day, and I am not talking about

mere bullion gold, experienced collectors will not touch a substandard coin. So be forewarned

gold coins are difficult to master as I have been finding out. I had to get a quick tutorial

myself ,until I felt adequate to pick the exact quality I wanted.

greghansen · June 15, 2011 7:23PM

I'm going through that learning curve right now as I start to drift towards gold coins after focusing on large silver my whole life.

ambro51 · June 15, 2011 9:52PM

....the advantage of the sticker comes into play here.

very few collectors have this quality of 'eye'.

pmh1nic · June 15, 2011 10:11PM

I have never liked the idea of grading coins on a curve based on metal, series, etc., etc. IMHO it is a source of confusion, especially for those that are not well versed in a particular series.

PQueue · June 15, 2011 10:13PM

Very true, however I think another factor is not as well understood by those new to Gold. Most newbies have a harder time determining when MS gold has been dipped, sometimes repeatedly so. Original surfaces on MS coins are harder to find than many realize. As with coins of all metals, sticker or not, the collector needs to personally be able to recognize substandard coins as Bear states.

ricko · June 15, 2011 10:58PM

Gold is certainly challenging, especially in the upper grades.... SaintGuru should give classes on this topic.

Cheers, RickO

ecichlid · June 16, 2011 12:44AM

<< <i>I have never liked the idea of grading coins on a curve based on metal, series, etc., etc. IMHO it is a source of confusion, especially for those that are not well versed in a particular series. >>

Agreed. It shouldn't be that way.

Bear · June 16, 2011 2:02AM

Is I have been buying goldcoins from reliable dealers, as well as high grade rather expensive

coins, it has been a bit easier determining if the coin meets my standard rather then russling

thru hundreds of coins. I let the dealers winnow down the number I have to look at. Further

I do not buy raw gold coins. No matter what, the coins must be graded, preferably by PCGS.

Of course a CAC sticker is some help, but I must be the finalizer in this process. If the coin

is not a WOW COIN, then it will not get the top price when sold in 10-20 years. The most successful

collectors like TDN and HRH and Saintguru, know this and that is why they succeed so handsomely, when they sell

their magnificent collections after the appropriate period of time has passed..You can not go too far

wrong working with knowledgabe and cooperative dealers who know quality gold coins, get top

gtrading and use common sense in knowing that quality coins are never cheap and cheap coin are

never quality coins. With a little experience, good TPG, some good advise from dealers you should do OK.

Just follow in the footsteps of the successful collectors as I am trying to do and we shold all be OK. Remember

about gold it is original skin, luster and lack of bag marks on face and fields.

TPRC · June 16, 2011 2:21AM

This is a very good post as I am interested in knowing how best to learn about recognizing quality gold pieces.

I consider myself an experienced, knowledgeable collector and I know how to grade, but I have mostly stayed away from gold because I have always had difficulty with it. I own only 6 or 7 pieces, all purchased at great prices. Nothing major. But how best to learn and buy from here? CAC? Certain dealers?

Trust me, I won't be venturing into deep waters any time soon, but I am curious to get some advice here.

hchcoin · June 16, 2011 2:32AM

"and use common sense in knowing that quality coins are never cheap and cheap coin are never quality coins.

Bear - I have been reading your posts the past few weeks and have really enjoyed your insight into your collection and why you are buying certain coins. I have also read the posts from people who are concerned you are going too fast when you put your collection together. I want to offer an alternative position to the one you have stated above. I agree that if you are in a hurry, quality coins are never cheap and cheap coins are never quality coins. On the other hand, if you have time, patience, education and experience on your side along with the ability to sift through hundreds and even thousands of coins at local, regional and national shows, you can come up with some beautiful, inexpensive, rare coins that fit your description of quality. I have found patience to be one of my best allies when deciding to make a purchase. I wonder if some of the concern over the speed of your purchases is related to this concept of having to pay really strong money because time is of the essence. I also understand and have read the reason you need to assemble your collection quickly based on your health. Do you feel that it is possible to find quality coins at a "cheap" price if you have time to "cherry pick"?

I have also read with interest your forecast of the rare coin market and I tend to agree with you. I feel an upswing coming for really nice coins. On the flip side, I believe there are bargains to be found for rare quality coins at a great price if you have the patience and time.

I also agree that grading gold coins is extremely difficult!

Still waiting for you to pick up a quality bust quarter

jamesfsm · June 16, 2011 2:55AM

I think this last poster hit the nail respecting the concern of many for Bear. I too believe that a big part of the fun in collecting is the 'hunt' and that searching through boxes of coins looking for one that meets your standards is enjoyable. If you have time to search yourself, it ultimately may save money. If you pay somebody else to do the search, they must of course be paid.

Bear · June 16, 2011 3:15AM

HchCoin,I have looked at a number of Bust quarters but the prices for the really nice ones is quite high. I have owned

gems in the past,and I am very sorry that I sold them. I could have made a lot of money holding on to that series.

As for collecting gold coins it is a different world from what most of us are used to. The grading standards seem different for gold,

requiring one to seek a higher grade then we were used to in silver or copper. Then each series, depending on how scarce

the supply is, such as Liberty heads, in all gold series but 21/2 dollar coins, tend to force you into higher grades to get the same

quality as say Indian Heads.

Collecting gold coins are really broken down into three categories:

1. Bullion collectors who want the security of old gold at close to gold content rather then just AGEs. In this group, grading is not
such a big problem as MS is usually ok including bag marks.

2. The next category is the serious collector who is looking for quality coins with a mini wow look that will not cost an arm and a leg.
This particular category is the most difficult , the most time consuming and requires the most show shoe leather and patience. You have
to sort thru hundred upon hundreds of gold coins to find the 2-3 coins that have THE LOOK. Originality,luster and minimum bag marks
with few in the highly distracting areas ljke the face. In this hunt I tend favor the plus grades by PCGS as , in general, they look much
nicer.You can find nice coins in the MS-64, 64+, 65 and 65+ grades , but it ain't easy . When you buy your coins, have a plan on what
quality you can afford and try to match the same quality with all your gold coins or you will eventually become unhappy.You will find that some type,
in different series will require you to go to higher grades to get the same quality. That is because some types are much scarcer in supply
have become condition rare .

Remember when you buy gold, get as original coin as you can, even gold can be dipped to death and most have been. Look for good luster
and few bag marks especially of highly visible locations. Nice color to the coin. You do not want copper alloy spots breaking thru as this is
a turn off to potential buyers. Gold can come in a range of acceptable colors such as reddish, orange or bright gold. These colors are determined
mainly on where the gold used in minting, was mined. The return on properly selected coins in the grades recommended can be great over time, but
probably not as great as the last and most expensive option.

3. This is for the advanced collector with a reasonably large amount of money. It is no where near the same league as our famous TDN, but it is well above
the level of the average advanced collector. These coins will be high grade. If not the highest grade they will be close depending on availability and cost.
They will have few if any marks, hi luster and original skin. This is a fast, and expensive way to collect, but you get what you like and you let the select
dealer you are working with sort thru the dross to get down a select few for your final inspection and approval. It does not require a lot of leg work, or
time but it requires a lot of experience and a knowledge of values , quality and you require a plan as to what you want, how much you can spend and exactly
what you want your coins to look like. Also you want a major return on your investment in the 10-20 year time line I have set out.

There you have it, "The good, the bad and the ugly all in one thread".

TPRC · June 16, 2011 4:54AM

Thanks.

Bear · June 16, 2011 6:22AM

I just added two more superb gold coins and the pictures should be added in the next day or two.

That would be a clear indication what I collect in quality in catagory threetogether with the other

gold coins in the collection. Compare these pictures ,to what out there in MS-65, and MS-66 and you can

readily tell the difference between real quality , average quality and pure dross.

CalGold · June 16, 2011 6:47AM

Delted. Sent PM thoughts instead

Bear · June 16, 2011 7:09AM

The purpose of this thread was not to express the only way to collect or even the best way to collect

gold coins. However, since I am learning my way thru this unique sub specialty of collectors grade gold,

I thought that I would share some of my experience, during my rather steep learning curve. It is my wish

that more expert collectors of gold and gold specialty dealers will add their thought and advice to this thread.

We intermediate, modestly advanced and Newbie collector, always need all the help we can get especially

in the wonderful world of Gold coins.

Bear · June 17, 2011 4:55AM

bidask · June 17, 2011 5:44AM

Why don't you include 2 1/2 liberty gold?

Bear · June 17, 2011 6:12AM

I do have one in my collection. However, it is one of the more obtainable coins at the moment

and as its gold weight is rather low and due to its availability, its profit potential is not as great

as other series of gold coins. I tried to spell out what I have found out about rarity, condition and

availability in this thread, but each collector must decide for themselves what they like and what

they can afford. This thread is not the end all of information, it merely opens the door on more

general information and offers warnings. Collectors can then seek more info from reference books,

specialty dealers and advanced gold collectors. Remember, while I am a fairly advanced collector

of classical silver type, I am still a newbie myself, when it comes to collecting gold coins.

Baley · June 17, 2011 7:40AM

When you see an unc gold coin for the first time, look at each side for 5 seconds, then turn away.

If there are specific marks you remember, or any distracting groups of smaller marks in your mind's eye

pass

Grading and buying gold coins for your collection

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