By Louis Golino for CoinWeek….
Thirty plus years after the establishment of the first professional coin grading companies, some modern coin collectors remain skeptical of the benefits of third party grading. For many of them buying raw, ungraded coins is a kind of badge of honor that shows they have not succumbed to the mania for plastic holders. They rely on their own ability to grade coins and believe third party grading is a waste of money.
There is no question that the grading companies are not perfect. Sometimes they make mistakes, giving a grade that is clearly too high or too low for a coin. But overall, they perform useful functions by authenticating coins, protecting consumers from subjectively graded coins, adding market value in many cases, and generally facilitating the buying and selling of coins.
The grading of modern U.S. Mint coins has become a huge cottage industry for the grading companies and a major source of revenue for them, especially with all the large bulk orders they receive from dealers. But the grading of these coins continues to be especially controversial for a number of reasons. Some collectors feel slabbing reduces the value of coins, no matter what grade they receive. They think slabs are like caskets and prefer to be able to view the coin more closely. Others are convinced their coins are mishandled during the grading process, or that Mint capsules offer better protection than slabs. I am doubtful of both propositions.
In addition, the labeling of coins delivered to third party grading companies within 30 days of their release as “first strikes” or “early releases” remains controversial. There is no way to prove those coins were actually struck first. But some coins were hard to obtain within 30 days of their release because of delays in processing Mint orders, such as the 2009 Ultra High Relief double eagle, and UHR’s with the first strike or early release labels do bring higher premiums than coins without the label.
Perhaps most importantly, there is a growing preference among collectors and dealers for modern coins in their original government packaging (OGP) over the same coin in a slab of any grade or grading service. Some people view modern coins which are graded MS69 or below as “damaged goods.”
Modern coins which receive the top grade of MS70 are viewed with skepticism by some collectors and dealers. That is because the Mint tends to produce collector coins to very high standards, for the most part, and virtually any coin submitted for grading will receive either MS or PF69 or 70, although once in a while one gets a coin back with a 68 grade or lower. There are some exceptions to this general rule. The bullion versions of the five-ounce America the Beautiful coins, for example, have not received grades higher than MS69 from PCGS and NGC, but the collector versions have produced plenty of MS70 coins.
The main problem with modern MS70 coins is that their market value is largely a function of the population numbers for the coin in question in the top grade, and those numbers change all the time as more coins are submitted and come back as 70’s. A lot of collectors of modern U.S. coins make the mistake of paying a high premium for a 70-graded coin when it is relatively new to the marketplace, and over time the value of their coin declines substantially as the population numbers in that grade continue to increase because more people submit their coins.
So the first recommendation I would make is if you are not submitting coins yourself which come back as 70’s, and you are buying previously-graded coins which received the top grade, wait until the coin is no longer new to the market. Track how the premium for that coin in 70 evolves over time before purchasing one. There is no set amount of time, and clearly one can wait too long, but it is a good rule of thumb with modern coins not to get too caught up in the hype that tends to surround recent releases.
In addition, shop around. There are times when one can purchase 70s for a very small premium over raw coins. For example, last year I was able to purchase a 70 of a certain precious metal coin for virtually the same price the Mint charged for a raw coin. In this case, I acted sooner rather than later because I knew the coin was a great deal. Today it carries a nice premium.
Third, if you collect top-graded modern coins, I would suggest avoiding those from companies other than NGC and PCGS. There are certainly other reputable grading companies, such as ANACS and ICG, but they tend to use different standards when assigning grades to modern coins than do the two top companies.
Fourth, even experienced collectors and dealers have difficulty telling the difference between a 69 and a 70. Examine your coin from the Mint for possible flaws, and if possible obtain the opinion of a local dealer who has more than likely seen a lot more coins than you have. Grading fees, especially at NGC and PCGS, are costly, especially if you add fees for first strike coins, and in most cases, if you do not receive a 70, you will have overpaid. Dealers send in lots of coins at once and can be assured of getting some 70’s that will recoup a lot of their grading fees, but most collectors are not submitting large numbers of coins at once, so it is a gamble. In addition, the competition for registry sets sometimes drives the prices of very common coins in perfect grades to levels that do not make any sense such as MS70 Lincoln pennies that have sold for more than $10,000.
Finally, the market for MS70 coins as opposed to those in OGP is evolving. I recently attended the Baltimore Expo and had the opportunity to discuss this issue with John Robinson of Edgewood coin store in Florida. He told me that his company pays more for modern coins in their OGP than for slabbed versions, including MS-70’s, which surprised me. In his view third party grading is really only suitable for classic coins.
But remember that some coins graded MS70 are worth a lot more than raw or MS69 examples. A case in point is the rare, proof-only 1995-W silver eagle, which has a value in MS70 that is 10 times its value in OGP or MS69. In addition, if you are trying to get a good price for an MS70 coin, sell it to a company that specializes in modern coins such as Modern Coin Mart or APMEX
Louis Golino is a coin collector and numismatic writer, whose articles on coins have appeared in Coin World, Numismatic News, and a number of different coin web sites. He writes the bi-weekly column “The Coin Analyst” for Coin Week. He collects U.S. and European coins and is a member of the ANA, PCGS, NGC, and CAC. He has also worked for the U.S. Library of Congress and has been a syndicated columnist and news analyst on international affairs for a wide variety of newspapers and web sites.
Greetings! This is my 1st comment here so I just wanted to give a quick shout out and say I truly enjoy reading your posts. Can you suggest any other blogs/websites/forums that cover the same subjects? Thank you!
Thanks very much, goldcoinsg. You may want to check out http://www.coinupdate.com, http://www.mintnewsblog.com, and the ANA’s magazine called “The Numismatist,” which periodically highlights useful web sites.
I understand what you’re saying but those “caskets” keep the coins safe. Sure it’s nice to handle the coin, but if you’re looking at it as more investment than hobby, I don’t see what the problem is.
I agree. It is not at all my view that they are caskets. I was referring to the views of other collectors. If you collect something like Morgan dollars, it makes no sense to buy raw esp. for better dates. I also agree the slabs offer better protection long-term, but some people disagree.
Thanks for the article. Recent BIN prices on eBay for MS69 and PF69 2011 Mint products are LESS than what you can purchase them raw for. I agree wholeheartedly with John Robinson that TPG’s are really only suitable for classic coins. In fact I made that point in my post on the Mint News Blog site. I think I will keep my ATB numismatics in the OGP. The over-sized slabs are ridiculous, heavy and will take up a bunch of room. I’m a young guy and have a good 30 years until I retire. I hope the John Robinson’s of the industry are still around when I go to sell. I will hold on to my original invoice as proof of authenticity. There’s something about originality of collectibles and the TPG tomb stones kill that with the ATB’s.
I have 7 sets of the 2010 ATB bullion. I will cherry pick those to be graded for the sole purpose of resale value years from now. I have high hopes for them and there will always be people to overpay for rounds of bullion!
Thanks for your comment and your feedback, Sun Tzu.
This article is hardly an objective analysis of the merits and demerits of grading and TPGs. Furthermore it is stated (or pormoted) here that one should keep to PCGS and NGC as if they are the final word on the “grade” of a coin. Clearly it is geared more to the industry of flippers rather than to purchase and hold collectors like myself who care not for the number on the plastic but far more for the coin and what it represents. This is always deeper than the “grade,” and every coin has a message – take the common humble small cent and its evolution, and even the fact that a handful want to haughtily rid them selves of its production and circulation. We forget to remember when tossing our cents that Abraham Lincoln was chosen on the cent to remind us often of the highly significant reasons, actions, and gifts to our nation attributed to him, and also his great humanity. A TPG grade from PCGS and NGC is not worthless but is utterly meaningless in this frame of reference.
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Hello Louis, it’s as if you’ve been reading the posts’ from the e-bay coin forum. I agree whole heartedly with your article, I collect both a raw set and a slabbed set of every coin i can get! My biggest question to all the Hard core ms-70 , pr -70 collectors has been , would you break that coin out of the slab and resubmit it? Do you honestly feel it would grade a 70 again?
The reason I only buy grade 69. I will purchase 70 grades if they can be obtained for a SMALL fee above 69. Don’t get me started on the First strike designation!
You have totally mischaracterized and misunderstood what I wrote. I did not say one has to “stick to” PCGS and NGC, nor did I state that they are the “final word.” I only recommended that if one is buying “top-graded” (meaning MS70) coins, one should realize that a 70 from other companies does not have the same value in the marketplace as a 70 from other companies. Furthermore, I am a collector, not a flipper. The whole issue of TPG’s is complex, and I mainly focused on the 70 issue in this article. I will be discussing other aspects in the future.
Charles, Thanks a lot for your comments.
In the third sentence, I meant to write that “a 70 from other companies does not have the same value in the marketplace as a 70 from PCGS or NGC.” Note I am not saying that I think it should be that way, only that that is how modern coins graded 70 are currently valued. I wrote this so that someone newer to the field does not buy, for example, an ICG 70 and think they got a great deal because the price is cheaper than the same coin in a PCGS or NGC holder. I buy some coins raw and some slabbed. I have some of my Mint coins graded, others I leave in OGP. One size does not fit all.
Ah, I see Louis. Great minds think alike!
For those who are interested, we have published another viewpoint on this subject we received from John Maben at ModernCoinMart. The article can be found here:
For many years it has been a rumor that Dealers get better deals on MS70 rather than individuals.
Well it’s true and I can prove it. I have a dealers account but send in small amounts from myself or my customers, I have never EVER had an MS70 for a silver eagle. Yet one the largest dealers in Florida only sells MS70 Silver eagles, I dropped into there store and asked if I could buy some graded silver eagles, they showed them to me, I asked if they had any cheaper such a MS69, they told, me “All our coins are MS70, we have them graded straight out of the US mint tubes 100’s at a time.
So I left, I sent a whole tube in and they all come back MS69, it was a sealed tube, I have sent others in as well, I have even gone through them trying to get the absolute best, yet none of mine have ever made MS70. How strange yet this BIG dealer only gets MS70’s back. I was still not convinced, so I purchased one on eBay from his dealer, an MS70. I very carefully cut it out, Nothing was touched, I was even using gloves, I sent it off, And yes you are right it came back MS69. This is without a doubt proof that BIG dealers get better grades, I console myself knowing this for a fact. Do I go public and reveal this shameless scam?
HELL YES YOU GO PUBLIC!!!!!!!!!!!!!!!
THE 69 AND 70 IS SUCH a scam im scared to fool with em
GO PUBLIC PLEASE
Secret NGC Dealer: You have done everything correct to expose this situation. I am posting 9 months since you posted. Has there been an update on this?
I am a beginner collector of coins. I have one question that I cannot seem to answer by searching the internet. This may be a stupid question, but…Which is worth more, a MS-69 or a PR-69? Are Proofs more or less valuable that Mint States? For example, I have 2 US quarters graded by PCGS. One is graded PR69 DCAM and one is graded MS69. Which is more valuable? Is there a big difference in value?
Hi Jeffrey O. Grayson,
I am a newbie myself, and have spent 3+ months researching differences in coin grading and coin differences. What I can tell you is the following:
PF (or PR) means that the coin is of proof quality. These tend to be rarer, and has a higher standard compared to the MS (Mint State). The MS coins, although uncirculated, tend to be produced more in quantify.
PCGS uses the term DCAM for Deep Cameo — the high reflectivity of the coin (mirror like).
NGC uses the term UC for the same thing.
Thus, given your questions, I would tend to give a higher premium to the PR69 DCAM versus the MS69. How much more? That is the part I’m still trying to decipher. The overall premium difference would be dependent on the quantity of the coins produced, the overall silver market heartbeat, and some *very subjective* interpretations.
For my part, I tend to shy away from these slabs, when I can.
I have found that the original government packaging is more than adequate. I am also curious as to the outcome from Secret NGC Dealer’s finding. I agree that it’s a very subjective “art”.
That depends. How old are they? And the type of coin. For example, a 1986 MS69 Silver Eagle (ASE) will probably sell for more than a PF69 1986 ASE. But an MS70 1986 or MS70 1996 Silver Eagle will sell for MUCH MORE than a PF70 1986 or 1996. Why? Because the business strikes were, and always have been, treated and handled like junk silver. If someone cracked a proof ASE out of its case, they probably used gloves (with the exception of grading companies) and definitely handled it only by the edges. But with the business strikes, dealers are notorious for just popping open a tube and getting their grubby paws all over them. So, after 25-35 years, very few business strikes/bullion versions remain that are still in pristine condition. But almost every proof that was ever made was handled with care and therefore many more remain in excellent condition. As a result, there are many more older proof ASEs in excellent condition than business strikes, and an MS70 1986 can fetch over $1,000 but a PF70 might only get around $200-$300.
ANOTHER great article Louis!!
Seems to me that, unless you can get these kind of collector-only coins in MS70s fairly close to the mint price as the author did, it might be a good idea to wait a few years to see what develops.
I have to disagree with the author about paying 10 grand for a regular issue circulated coin in MS70 though…the sky is the limit on the value of such an extremely rare coin. And I suspect that in the future, as more and more collectors become more and more discriminating, the demand will just skyrocket for perfect coins to add to their Lincoln Penny, Jefferson Nickel, etc. sets….I mean how often do you even hear of MS68 except mainly in cartwheels, which seem to have preserved better than most coins.
I am old enough to remember when collectors really first started to talk about the difference between “UNC.” and MS60 and MS65. Then a couple year later, at a show, I can recall some dealers complaining about MS63 being kind of stupid, and similarly that one couldn’t tell the difference between 65 and 67. A couple years after that, I remember seeing MS61 and MS62 somewhere. But MS70….who would even dare such a grade…that required the slabbing companies, and the market has changed rapidly since then. And it is still changing, but perfect is perfect, and every human on the planet understands that concept!
Real numismatism isn’t really about the government producing special coins for them, we all need to remember. Real coin collecting is about collecting coins, typically ones that people get in change, or at least from banks in bags. Although it is unlikely to find a Indian Head penny in change anymore, and wheaties are getting quite uncommon, looking for high grades could be the next thing..
I agree tha the perecntage of “modern” coims, such as 2016 Silver Eagles, will geade higher more frequently than an older coin, such as 1960’s quarters or dimes, simply because of the new tech coin presses and dies which are laser cut out of a much better steel alloy. That said, I would GLADLY trade one of my MS70, 2016 Silver eagles for an MS 63 Franklin half! Who wouldn’t? Thank you for all of the information!!
I just started buying coins, can’t say I officially collect them, as I have found none.
I will say this as a newbie – discovering, they’ll (ANACS, PCGS, NGC) grade anything and everything, which to me, makes all this, “not special.” When reading that, dealers buy 70’s cheap etc. that also adds to the sentiment, “not special.”
So, I just so happen to take a fancy to the 2018 Jim Thorpe Sacajawea dollar, right? I purchased a box of 10 rolls (250 coins) 5 minutes after the U.S. mint released them. I crack open all the rolls and pull 15 or so beauties and pop em in direct-fit capsules. The remainder, kept a few loose ones, tossed em in a bag, and gave a few as tips @ restaurants, and then took the rest to a bank. Some may think I’m stupid.
If in fact I decide to get most of those graded and they (PCGS, NGC, ANACs) grade just one a 68 and a few 67’s, I’m happy.
I understand I just sent 200 into circulation, a few people will be happy to get em.
Now, let’s shift to the proof of the Jim Thorpe dollar. I can buy them all day long, with a grade of 70, between $20 and $25. I purchased 10 at that price point, cause maybe, just maybe they might rise in value – knowing very well they may not, as they are a dime a dozen. I know one dealer who keeps on putting them up for sale, like he has a million of them. I still like them. So, I buy them.
I’ll finished with this. You may think I am confused and toss money away. Maybe so – I am more impressed with a ms68 uncirculated business coin, that received a ms68 because it was found to be exceptional, and less impressed with proof coins that receive 70’s because they were made that way on purpose.
What I find, which aligns with my last statement, that proofs graded as 70’s are way less expensive vs. an ms68 business strike, which lists for 5 to 10 times that of the proof.
I just tried sell some my coins MS 70 AND MS69……..the dealers aren’t giving any extra money for these, you just get the current bullion price of silver…….what? I paid 100.00 each for alot of my MS 70 FIRST DAY – ISSUE…..what a scam!!!!!
A lot of American eagles are not true 70”s when graded 70 on the slab,I seen a few with 2 small nicks the size of a period at the end of a sentence. Those are 69”s. Remember quality control.if the govt. makes 5.6 million or less in any production year and only 3%-4% are being sent in to be graded then how about those that are still raw not graded a lot of those are 70 quality, I have seen examples not graded. Under a 5 power glass a sheen look no milk spots no nicks no imperfections. It started back in the early 2000”s when some market makers came together involving registry set ups to have the best of the best,a lot of American eagles were over 10k bid back in 2018 but they have been falling in price but they still sell at auction, buyer be ware. Greg
The reason to get a modern coin graded these days is simply because, if you want to sell your coins, you will get MUCH MORE for them on eBay than your local dealer. And a purchaser on eBay is going to question the quality of the coin if it is not professionally graded. You can take all the personal photos in the world of your ungraded coin and post them on eBay, but every potential buyer will think to themselves “is this guy just showing pictures that cover up flaws with camera angles and lighting.” In fact, even when it comes to graded coins, there is still the possibility a 70 graded coin could still have flaws (I received an NGC proof Silver Eagle graded PF70 with a scratch across the sun that was so big you coud see it from 5 ft away LOL) and I think that because of this NGC “Photo Vision” and PCGS “Photograde” will become more popular because for just an extra $5 with PCGS and $8 with NGC you get a professional, non-bias picture of the exact coin a person is buying. As they say, “buy the coin, not the holder.” And a graded coin along with a professional picture gives an online buyer confidence in what they are getting and therefore will most likely pay more, or much more for your coin.
Grabbing all the 1927 s Standing Liberty quarters I can find in VG – VF condition at reasonable prices. Mintage lower than the 1909 s-vdb cent. Buying mostly unslabbed but some slabbed available in those lower conditions.