There are many coin price guides published; weekly, bi-weekly, monthly and annually. They come in the form of magazines, newsprint, “hot sheets”, and books. All of us have referred to one of these from time to time to ascertain what a particular coin might be worth. Yet, few of us stop to think about what we are getting from any one of these Price Guides, beyond the price or value of a coin. After all, don’t price guides, just give you the price? What else is there?

Basic to an understanding of price guides are two things: 1) the Grade of the Coin; and 2) the Foundation of the price guide. Knowing the Grade of the Coin is required before one can begin. Saying so seems to be obvious, but what more does it mean?

Unless the coin is Graded by an appropriate Professional Grading Company, which has designated what Grade and Identity has been assigned to the coin, most of us are making an assumption about the actual Grade. This assumption we make can be very dangerous because of: a) the difficulty in grading a coin; and, b) the different possible outcomes or results that occur. One Grade “point” or level can make the difference in hundreds or thousands of dollars in the Value of a Coin.

Price Guides assume that YOU already Know the Grade of the Coin. This is why we have the First Rule of Coin Collecting: Know the Grade of Your Coin.

Secondly, ALL Price Guides are founded on the same Principle, which is that the Coin, whose price you are looking up, has been Graded using one Grading Standard. That Grading Standard is set by the ANA – American Numismatic Association – and is entitled the Official Grading Standards For US Coins.

Therefore, ALL Price Guides have a “silent assumption” built in to their guide; which is that the Grade that YOU decide upon, is True or Accurate, and that such Grade is based on the ANA Standards.

The first difficulty that arises is that most people never know if the Grade that they have decided upon is Accurate. Of course, this difficulty never comes into question, if the coin is Professionally Graded by an appropriate company. There are only four (4) reputable Professional Grading companies that strictly follow the Guidelines set by the ANA, and they are: PCGS, NGC, ICG, and ANACS.

The second difficulty arises because of this “silent assumption” or Foundation of all price guides is whether or not the Grade decided upon, was made using the Guidelines or Standards established by the ANA. If you don’t have the skills and training of a professional coin grader, the decision on the grade is probably questionable.

Even if you do have the skills and training of a professional coin grader, the decision is still probably questionable. Why? Because even professional coin graders have differing opinions. This is why the reputable professional coin grading companies require the opinions of three (3) professional coin graders to arrive at the “Grade” designation to be placed on every coin.

The obvious conclusion is that a Serious Coin Collector is going to invest in rare and modern coins that are graded by one of the Top Four reputable Grading companies. It is the only certain way to eliminate the disagreements and arguments about the Grade of Any coin being Bought or Sold! It is the only certain way one can Value their coin collection. It also eliminates “getting taken” or cheated buying raw coins.

Why should a coin collector and investor buy and collect professionally graded and certified coins? Commonly called “slabs”, they are housed in a protective plastic holder. There are many companies – over a dozen are less than 2 years old – which will put your coin in a slab after Certifying that it is Authentic, and assigning a Grade to the coin. The first reason for buying and collecting Certified and Graded Coins applies to all of these companies. However, the most important reasons apply only to the Top Four companies: PCGS, NGC, ANACS, and ICG.

Reason No 1. To Protect Your Coin from Damage.

Visible Damage, which includes anything from finger prints/oils to being stepped on. More importantly, Environmental Damage, including such things as exposure to the air, or the wrong kind of air, chemicals in the air, and touching other objects (e.g.: certain plastics, liquids, food) and other coins, which will change the appearance and even structure of the coin. Damage causes loss of Value, which means Your Investment. A slab is an air tight container, and its purpose is Protection.

Reason No 2. To Establish Authenticity.

You want and need to know that your coin is not only the Real thing, but that it has not been altered (changing a mint mark – fraud) or changed, for example by cleaning, polishing, changing the appearance or surface of the coin, in any way that would render your coin unfit to collect. If it is Unfit to Collect, there won’t be many Buyers or Sellers. Many coins graded by lesser companies end up getting Rejected by one of the Top Four for these reasons.

Reason No 3. To Establish Identity.

Is that 1909 Lincoln penny a VDB? Did you overlook the “S” mint mark. Is it a Type 1 or Type 2? These little identifying marks can mean the difference between a $20 coin and one worth $35,000. We all make mistakes and overlook or miss, mint marks, details, and certain other identifying factors which make up “Verities” of each coin. It is the professional’s duty to look for, and establish these things to determine a coin’s true Identity.

Reason No 4. To Establish the Coin’s Grade.

A coin’s Grade is what determines its Value. You want Good Value when you Buy the coin. You want to get what you pay for (or more) and not get cheated. When you get ready to Sell or Upgrade, you want to get the most for your coin. You have to Know what your coin is Worth! The Grade is always an Issue when Buying and Selling a Collectible Coin. Having the coin Professionally Certified and Graded virtually eliminates this Issue, and the Arguments. This is Your Neutral Third Party.

Reason No 5. Trust and Credibility.

The Top Four companies are Consistent, Reliable and Trustworthy. They have Established and Respected Reputations. Their Standards are the Highest and the Best. You are taking a Risk when buying a certified and graded coin from any other company. When you Sell a Certified and Graded Coin, it will speak for you. The reputation of the Grading Company will firmly establish the Grade of the Coin. This translates into the Value or Worth of the Coin.

It is possible to buy and sell a coin that is Certified and Graded by one of the Top Four, sight unseen, and know exactly what you are getting. From a description of the coin (e.g.: 1903 O, MS66, NGC, Morgan #034), you know what you are buying, and what to expect. It always helps to have a little description of its appearance, such as “white hot” or “slight reverse toning”, since there is one limitation to selling a Certified and Graded coin sight unseen: It is still possible to buy an ugly coin. But that is why we have scanners, fax and email.

Therefore, as a Coin Collector and Investor, always collect Certified and Graded coins by one of the Top Four. It is the most reasonable way to verify authenticity and identity of every coin in your collection, as well as to establish a reliable Value. Every source of prices for any coin, be it a yearly book, magazine, a weekly or monthly newsprint; all base their prices on the Grading Standards of the Top Four grading companies, which strictly follow the ANA (American Numismatic Association) guidelines. If the Grade of your coin does not measure up to these Standards, then you are only guessing at the Value.

Robert L Taylor, JD

Copyright ©2006, Robert L Taylor, JD

About the Author

Robert Taylor is a 60 year old retired Lawyer, from Denver, CO, who spent most of his career representing people who could not afford an attorney, and who has had a passion for collecting US coins, since the age of 6. Wanting to share his Passion, he created http://www.ThePerfect-Coin.Com which features US Rare and Modern Coins (from 1960) and http://www.PerfectDollarCoins.Com featuring US Dollar Coins (from 1878), all Certified and Graded by NGC, PCGS, ICG and ANACS.