One size fits all pricing approach doesn’t always work with Morgan dollars

By Steve Roach –
First published in the March 7, 2011, Special Edition of Coin World

The Morgan dollar is widely traded at all levels, from the top-grade rarities that sell in the high-six figures for investment portfolios to the low-grade polished coins that trade in bulk as collectible alternatives to silver bullion.

The top end of the Morgan dollar market is healthy, with expensive coins in the $5,000 to $250,000 level finding buyers when appearing at auction and bidders paying extra when a top-quality coin meets their requirements.

For example, at the Jan. 5 Heritage Florida United Numismatists auction, an 1893-S Morgan dollar graded About Uncirculated 58 sold for $80,500. Between 2008 and 2009, four AU-58 examples appeared at auction, with prices realized ranging from $21,850 to $46,000.

In contrast, an MS-64 example sold at the Jan. 5 Heritage auction for $218,500, while at the 2009 FUN Heritage auction, two 1893-S Morgan dollars sold for $299,000 — one was graded MS-64 by Professional Coin Grading Service, another Mint State 65 by Numismatic Guaranty Corp.

It can’t be stressed enough: When dealing with five-figure plus coins, a one size fits all approach to pricing does not work as the quality of a coin within a given grade matters more than ever in today’s market.

Yet, for the collector on a budget, a PCGS Genuine 1893-S Morgan dollar sold at Heritage’s Feb. 4 auction for $1,265. While it had the .94 suffix, indicating Altered Surfaces, from the picture it looked decent enough to not cause embarrassment if added to one’s collection. (See image)

Beautiful rainbow toned Morgan dollars continue to see astonishing prices, such as the 1883 Morgan dollar graded MS-65 that sold for $1,725 at Heritage’s Jan. 6 auction, more than 10 times what a brilliant example in the same grade would bring.

One area that has shown remarkable movement in the last year has been certified Mint State generic coins — “generic” indicating a coin that does not trade for a premium because of its date.

As of Jan. 26, examples certified by PCGS and NGC are trading wholesale for $45 in MS-63, $65 in MS-64, $138 in MS-65, $230 in MS-66 and $565 in MS-67, provided that they are untoned, or nearly so. For comparison, last year at this time the wholesale pricing was: MS-63, $35; MS-64, $44; MS-65, $112; MS-66, $210; and MS-67 $630.

While MS-64 examples have increased nearly 50 percent in the last year, MS-67 examples have declined 10 percent. Of course, a broader range of collectors — and would-be collectors that marketers can target — can afford MS-64 coins, and marketers know this.

For many collectors, an MS-67 Morgan dollar is a coin easily found that can wait for better economic times.

Circulated Morgan dollars are also showing a healthy market, with dealers paying $30 for “sliders” — choice About Uncirculated coins that can pass as Uncirculated to untrained eyes — and $34 for solid Mint State coins. For comparison, this is the same price that certified MS-61 and MS-62 coins are trading for in wholesale markets.

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