News and Analysis of scarce coins, markets, and the coin collecting community #330
A Weekly CoinWeek Column by Greg Reynolds ……
This discussion is aimed at a wide audience, not just prospective buyers of Barber quarters. Indeed, the broader implications of interpreting auction results for type coins over a five-year period are of interest to collectors and other coin buyers who are not very interested in PCGS- or NGC-certified “MS-66” grade Barber quarters of the least scarce dates.
The approach here may be fairly applied to most types of U.S. coins that started after 1859 and before 1916.
These include:
- Flying Eagle cents
- Shield nickels
- Liberty Seated dimes with legend on the obverse
- Barber dimes
- ‘With Motto’ Liberty Seated quarters and halves
- Barber half dollars and
- Three Dollar Gold pieces
A key point is that there is a sharp limit to the benefits of analyzing prices over time without actually examining the coins being offered. For purposes relating to estimating market values, however, there is less of a need to examine type coins than there is to examine rarities.
What Are Type Coins?
For U.S. coins minted after 1840 and before 1917, a type coin is typically not a rarity and not super-common. A type coin is a representative of a design type, and is typically one of the least scarce dates of the respective design type.
For series of U.S. coins that began after 1907, the least scarce dates are usually super-common; tens of thousands or even hundreds of thousands exist in the present. These are classified as generics, not as type coins. Although generics may serve as type coins to represent design types in type sets, generics and type coins are traditionally defined as separate categories.
As generics are so extremely common and are often traded in quantities, it would not make sense to use auction results as primary inputs in an analysis of their respective values. Clear examples of generics are 1881-S Morgan silver dollars, common Mercury dimes, common Walkers, 1938-D Buffalo nickels, most Indian Head $2.5 gold coins, 1901-S $10 gold coins, 1926 $10 gold coins, 1924 $20 gold coins, and 1928 $20 coins. There are many others. These should be distinguished from type coins.
No Barber quarter is generic. Although type coins are neither very rare nor very common, some type coins are condition rarities in very high grade ranges (66 or higher). Enough “MS-66” Barber quarters have been certified so that analyzing trends in auction results is a practical and meaningful activity.
No auction result for one coin–and no one whole auction–will provide concrete evidence of underlying market realities. There is a need to take multiple factors into consideration, especially trends over time and the characteristics of individual coins. Even so, the analysis here should lead to a decent understanding of market values for certified “MS-66” Barber quarters of the least scarce dates, type coins.
For type coins, the precise quality of a specific coin is less important than the precise quality of rarities. With a couple of possible exceptions, post-1840 type coins are not difficult to replace. Well-informed buyers often figure that they can avoid one type coin and later find another with the same certified grade that is more appealing and for a similar price.
Also, many beginners or casual buyers just glance at the online images and enter bids without thinking much about the true quality of the respective coins.
For type coins, there is often a buyer who does not know how to grade coins, or doesn’t really care about the underlying physical characteristics of the coin. Such a market participant will ‘buy the holder, not the coin,’ and rely upon the respective certification. Although I am opposed to the ‘buy the holder’ concept, I am not expressing my own opinions here. I am providing information relating to the realities of coin markets. Over the past 30 years, there have been many coin buyers who like to speculate in regard to market values of ‘the holders,’ the certifications of the coins being traded.
Collectors who are collecting rarities or assembling sets ‘by date’ are more likely to think beyond the holders and seek expert advice regarding the coins themselves. In the series of Barber quarters, for many dates, there are less than 25 coins certified as grading MS-66 or higher. For several, there are fewer than 10. For such condition rarities, the physical characteristics play a significant role in determining the market values (in most cases).
The 1892 quarter and the 1916-D quarter are not condition rarities in MS-66 grade. Although data published by PCGS and NGC includes multiple counts of some of the same individual coins (multiple “grading events”), it is likely that more than 130 different 1892 quarters have been graded as “MS-66” by PCGS or NGC or both services. At least 35 have been graded as “MS-67,” and a few have been graded as “MS-68.” CAC has approved 52 1892 quarters at the MS-66 level, and just one to eight, respectively, of each of the other dates from the 1890s.
PCGS- and NGC-graded coins are often submitted to CAC where experts approve and sticker the coins that they find to be “solid” for the already assigned grade. CAC has approved 55 1916-D quarters at the “MS-66” level. In contrast, 16 1911-S quarters, 10 1912 quarters, 12 1914 quarters, two 1914-S quarters and six 1915 quarters have been CAC-approved at the MS-66 level.
Fairly-graded “MS-66” 1892 and 1916-D quarters are excellent examples of gem type coins. Due to grade inflation and coin doctoring, PCGS- or NGC-graded “MS-65” Barber quarters are not as exceptional as they were, on average, 20 to 25 years ago. There are wholesalers who have earned considerable income over the course of their careers by way of continually re-submitting the same coins over and over again to PCGS. If leading experts in the present agree that a certified “MS-66” Barber quarter really merits the grade, it is usually a very attractive and technically sound coin, a really neat item that might capture the attention of someone who was not previously interested in coins.
Lower grade Barber coins are very desirable, too, though in different ways.
For years, I enjoyed collecting Barber dimes that grade from Fair-02 to Fine-12. In 2012, I wrote about well-circulated Barber quarters, with emphasis upon the key dates. I devoted a piece in my series on coins that cost less than $500 each to Barber half dollars.
Market Cycles and Data
The compiled data includes 38 auction results for PCGS- or NGC-graded “MS-66” 1892 quarters since January 2011. There are not a sufficient number of PCGS- or NGC-graded “MS-66+” 1892 or 1916-D quarters for these to be included in the present analysis.
Most results come from the Heritage archives. Some were found in the ‘new’ Stack’s Bowers auction archives, and one result is from a “GreatCollections” Internet-only sale. Results from auctions by the Goldbergs are welcome, though I could not find any certified “MS-66” 1892 quarters in their archives, in regard to auctions since January 2011.
The selection of January 2011 as a starting period for the present analysis is not arbitrary. Five years is a meaningful parameter in the realm of coin markets. Furthermore, markets for rare U.S. coins crashed after peaking at some point in early August 2008. The bottom was reached in April 2009 and markets were fairly volatile later in 2009. They stabilized during 2010, though it is hard to determine when a plateau was reached. Despite minor ups and downs along the way, the trend lines from 2011 to the first half of 2015 for rare U.S. coin prices were amazingly stable, oddly so. Previously, market for rare U.S. coins had been sharply cyclical since the 1850s, and often characterized by rapid upward or downward movements.
From August 2015 to February 2016, prices for rare coins and conditionally rare scarcities fell from 10% to 25%, depending upon the series and grade range, perhaps 15% to 20% overall. Since February, prices have fallen a little more, though not sharply.
1892 Barber Quarters
Please refer to Chart #1 above. Almost all the results fall between $900 and $2400, though are well scattered in that range and do not seem to point in any particular direction.
1892 Barber Quarter. MS-66 (PCGS). CAC.
On just one day in 2013, two CAC-approved “MS-66” 1892 quarters brought more than $3,500 each–one was PCGS-graded and the other was NGC-graded. Without seeing these specific coins and/or interviewing participants in that auction, it would not make sense to form a hypothesis as to why these two brought so much more than the others over the last five years. These two results were very strong prices. (Please read a pertinent article, What Are Auction Prices?)
The data suggests that the value of CAC stickers is substantial. In 2011, the average result for four stickered coins was $1,696.25, while the average result for two non-CAC coins, one in a PCGS holder and one in an NGC holder, was $1,552.50.
In 2013, there were six “MS-66” 1892 quarters sold at auction that were each CAC-approved; four of these were earlier PCGS-graded (C-P) and two had been NGC-graded (C-N). The highest price realized of the six, $3,818.75, was for an NGC-graded coin. The average for these six CAC-approved coins was $2,560.52.
In contrast, during 2013, there were three NGC-graded “MS-66” 1892 quarters without CAC stickers sold at auction. The average result was $1,233.75. Of four PCGS-graded “MS-66” 1892 quarters without CAC stickers, the average realization was $1,556.88.
Regarding sales of certified “MS-66” 1892 quarters in 2014, two were PCGS-graded and CAC-approved (C-P), $1,938.75 on average. Two were NGC-graded without stickers and realized $1,246.09 on average. Two were PCGS-graded without stickers, $1,703.75 on average.
Though sparse, the auction results for certified “MS-66” 1892 quarters in 2015 are consistent with my interpretation that market levels dropped substantially during last year. In January 2015, a PCGS graded “MS-66” 1892 quarter, without a sticker, realized $1,410. At the ANA convention in August, another brought $1,527.50. A third sold in December 2015 for just $940.
All three CAC-approved “MS-66” 1892 quarters sold last year were PCGS-graded. In January, the first brought $1,468.75. In September, the second sold for $1,292.50. In December 2015, a third went for $1,159.40. If, however, multiple leading wholesalers had these coins pegged as candidates for upgrades, then prices realized would have been much higher. Many CAC-approved coins in auctions in 2016 have been purchased by ‘crack-out artists’ seeking upgrades from PCGS or NGC, and prices realized for those may provide an illusion of increases in market values.
1916-D Barber Quarters
The ‘D’ indicates that 1916-D coins were struck at the Denver Mint. Classic U.S. coins without mintmarks were struck in Philadelphia.
1916-D Barber Quarter. MS-66 (PCGS).
For unknown reasons, multiple original rolls of choice ‘mint state’ 1916-D quarters survived. One was auctioned in the Stack’s session of Auction ’90. A West Coast dealer was the successful bidder. He submitted some or all of the coins to PCGS, and more than a few were PCGS-graded as MS-66. A rumor from a semi-reliable source suggested that another such roll surfaced in 2010, which was earlier from the same source as the roll that was auctioned in 1990.
I found 41 instances of PCGS- or NGC-graded “MS-66” 1916-D quarters selling at auction from January 2011 to March 2016. The 11 NGC-certified coins without CAC stickers sold for more on average ($1,423.35) than the 15 PCGS-certified “MS-66” 1916-D quarters without stickers, $1,267.33.
Fifteen were CAC approved, eight of which were PCGS-graded and seven were NGC-graded. The CAC-approved PCGS-graded coins sold for slightly more on average than their NGC-certified counterparts. The NGC coins, with CAC stickers, sold for about 8% less.
As the data here is spread over five years, with dropping market values near the end, it might make sense to separate the two NGC-certified coins, with stickers, that sold after August 2015. From January 2011 to June 2015, CAC approved, NGC graded “MS-66” 1916-D quarters sold for about 6.5% less than CAC-approved, PCGS-certified coins.
Again, the data supports my oft-repeated point that prices were stable, more or less, from some point in 2010 to the middle of 2015. Auction prices for certified “MS-66” 1916-D quarters tended to fluctuate in a range from $1,292.50 to $1,880 during that whole period, with CAC-approved 1916-D quarters bringing more on average than those that lack stickers. Please see Chart #2 below.
A curious exception is the $2,530 price paid for an NGC-graded MS-66 1916-D on April 17, 2011. It was not CAC-approved. This is a very strong price, not an indication of an increase then in market values for 1916-D quarters. There may or may not be a rational explanation.
Variations in auction results for coins with equivalent certifications are often due to interested bidders, or their agents, finding problems or especially appealing characteristics in regard to specific coins. Variations in auction results for coins with the same certifications often do not indicate fluctuations in market values.
In January 2014, an NGC-graded and CAC-approved 1916-D brought $2,056.25.This price is significantly higher than the auction results for CAC-approved “MS-66” 1916-D quarters in 2013, later in 2014, and in 2015.
Again, it is a strong price, and probably not an indication of a noteworthy change then in market value.
Concluding Remarks
I committed myself to writing about the topic of “MS-66” Barber quarters before I had much of a vision of the contents of the data that I later analyzed. While I knew that the 1892 and the 1916-D are relatively common, I had not thought at length about the condition rarity of most other dates in MS-66 and higher grades.
It is curious and important that the 1892 and the 1916-D are so much less scarce in the gem grade range than other Barber quarters that are generally regarded as ‘common dates,’ like the 1912, the 1914, the 1915, and the 1915-D. These differences in relative condition rarity are dramatic and surprising.
In the gem range, the 1892 and the 1916-D are the primary type coins in this series, and some of the others may be mis-understood condition rarities.
I was expecting to find more evidence of the sharp decline in coin markets from August 2015 to February 2016. There is certainly some evidence in the already discussed data, though not much. It could be true that “MS-66” grade Barber quarters fell in value to a lesser extent than did rare U.S. coins on average since August 2015.
©2016 Greg Reynolds
