From the Mar. 9 Numismatic News E-Newsletter:
Have third-party grading slabs added value to your personal coin collection?
Here are some answers sent from our e-newsletter readers to Editor Dave Harper.
Preservation of the coins, confidence in authenticity (especially of counterfeit prone key varieties) and establishment of (at least some) market pricing consensus have all been positive influences on the hobby.
The biggest negative has been overgrading, much of it attributable to favoritism toward volume customers. Third-party graders (TPGs) are in business to make money, and every coin they grade is one less bit of business they can do in the future, so they’re motivated toward keeping the big customers happy and coming back. Grade inflation over time is the other main source of overgrading, to the point that today’s market is very much a “buyer beware” environment. I’m a specialist in Flying Eagle cents. I own hundreds and look at hundreds more every week, and estimate that 30-40 percent of the slabs I see are overgraded. That CAC, Photo Seal and “OGH” effectively guarantee premium prices proves this.
The other negative that comes to mind is the shift in focus from the coin itself to the number on the holder; the pursuit of registry sets has turned into a great marketing tool for the TPGs. A sizeable fraction of so-called “collectors” these days are really just “accumulators,” though I’ll admit I’ve profited from this phenomenon.
I’m not a dealer, and the investment aspects really do come second to me, behind the beauty and history of the coins, and the thrill of the hunt in pursuit of my collecting goals, so the negatives don’t really affect me. I know what a given Flyer is worth because I’ve studied them for years. I know the grading standards cold. I know the varieties, and I keep up with the market on an almost daily basis, so I don’t get fooled. I pay fair prices and I get the value I pay for, and have a beautiful and valuable (and still growing) collection to show for it. When I do sell, usually because of upgrading at the high end these days, I have no trouble recouping what I paid for the outgoing piece. I attribute that mostly to the knowledge and experience I’ve built, but also partly to the stability that TPGs have brought.
I don’t think that they have added value, but they definitely make it easier for me to know the value of my graded coins.
Dallas-Fort Worth, Texas
My preference is not to have them in my collection. Most of the time I have found items to be misgraded. Yes, the finish can sometimes be correct, but the rims are shoddy. Yes, most can be from inserting incorrectly. Sometimes, not graded according to ANA standards. I did win a door prize six or seven years back, and both the grade and rim didn’t support what it was stated. I will not complain this time, since my cost was minimal. Basically, I am saying, “buyer beware.” Like NN says, educate oneself!
For a normal person collecting coins by country, denomination, year, mintmark and eventual variants, slabs are just rubbish! I don’t want to get rich on empty values.
So no, no value added to my collection of more than 38,900 different coins. I would never dream of having any of my coins slabbed! I collect coins because I’ve done that for more than 55 years and I’m still enjoying it, even contributing to the KM catalogs, AND I DON’T CARE about the value of my collection.
I have only used third-party grading services to verify that my keys (09-SVDB, ’14-D, etc.) are authentic and not altered. I do not believe in having coins, especially modern day coins, graded as most if not all of them especially in proof are 69s or 70s anyway. To me this is just another way to get more more money from us collectors. In other words, I do not buy labels as some collectors do. Most of my coins are in about 85 Dansco albums. But it has been said that there is no right or wrong way to collect coins. So if grading most or all of your coins is what you want to do, by all means have at it.
Yes, third-party grading has added value to my collection. Increased marketability when it comes to sell adds some degree of assurance that the items are genuine (backed by the grading service guarantee). With any collectible coin nowadays, a major concern is that Chinese counterfeits are widespread.
Long Beach, Calif.
Yes they have. When we first started collecting we cherry-picked our coins but sending some in to third-party graders we were crestfallen that some came back in body bags, with the most having been cleaned. We switched to third-party slabs and took the ANA grading class and continue to cherry-pick our collection, buying the coin and not the slab.
My Name is Richard Ziemiecki and I am a modest coin dealer in Camden, New South Wales, Australia. Without question, third-party grading services are a vital part of our industry. In an age where counterfeiting is rife, having your coin authenticated and graded instills confidence in buyers who are prepared to pay the extra fees to know their coins are genuine. I believe the workload for these services is becoming overwhelming and that’s why mistakes are happening. People all over the world are now seeing the benefits of slabbing.
The value of your coin positively increases and people can buy and sell with confidence. If you don’t trust the grading companies, then don’t use them. Personally I think they are of great benefit, and I will continue to use them till something better comes along.
Many of the key coins in my collection were slabbed when I bought them because I’m concerned about counterfeits and alterations. I trust my grading over that of the grading services. I still grade coins as I did in the 1960s while the grading companies have let their standards slip.
St. Louis, Mo.
Certification has increased my collection in two ways. 1.) I am now assured that the coins are genuine; and 2.) I can be fairly certain of the grade. In recent years, I have had numerous dealers tell me that their grade is the correct one, notwithstanding what any grading book states.
Yes, the value of my collection has risen considerably since I have over the years had all of my coins certified by PCGS and NGC and a handful by ANACS. My grading skills are fairly good, but I prefer to rely on the experts.
I don’t know if it is of interest, but I was “recruited” by SEGS years ago through a charter offer to have coins certified. I sent in maybe 10 pieces in total, all have since been cracked out and resubmitted to PCGS or NGC with mixed results. The one experience I just can’t forget involves my 1795 dollar, which I purchased raw from eBay. SEGS graded it as VF-20 cleaned and I was very satisfied with that. Some years later, when I started the conversion to other third-party graders, my SEGS 1795 dollar came back from PCGS as counterfeit. I was devastated, as I had saved for a couple of years to be able to afford a dollar of the type. This started a major episode of communications with SEGS and the PCGS and NGC bulletin boards. I was eventually contacted by Larry Briggs, and even though I held the SEGS slabbed coin for several years, he requested that I send it to him, which I did. He very honorably reimbursed my purchase price, and I was most appreciative. I also received a check from a numismatic organization (I don’t know who specifically) to help compensate me for the difference in price paid and the value the coin (if it was legitimate) it would have gained over its time in the SEGS slab. It didn’t make up the difference, but I wasn’t expecting either compensation payment, so it made the pain just a bit easier to bear.
I never was able to afford a replacement of the coin and to this day, now maybe 10 or more years later, I have not been able to afford a replacement. So, though I replied “yes” to your survey question, this was a significant loss to me, a reduction in the value of my collection and a souring of my opinion on third-party grading as a whole.
I am now 67 years old and attend an occasional coin show, though in retirement my budget for coins is more limited. My 1795 dollar was a major loss, and I fear I will never be able to replace it at this late date. What concerns me more, however, is when I am at coin shows, there are virtually no young collectors. Prices are just out of sight for young collectors, and I see this as a side effect of third-party grading.
I started assembling little baggies of minor U.S. coins: Buffalo nickels, Merc. dimes, Indian cents and the like, and a small group of foreign coins from my my travels. I assembled 10 groupings for the last show that I attended and only found two children to give them to. Where will the hobby be without young collectors, and what good will the increased value of certified coins be if there are so few collectors wanting them? I started collecting at age 7. There were no third-party graders then. Now, the hobby is for the well-heeled and just not what it once was, especially for youngsters who want to get a start. Perhaps a subsequent survey question could be: Are the third-party grading services improving the longevity and enjoyment of the hobby for future generations?
I don’t bother with slabs. A dealer friend said don’t slab your collection unless you are selling. If I want to buy something, it doesn’t matter if it is slabbed or not.
The real value that I find in the grading service is when I want to buy or sell coins by mail. This gives some kind of guarantee. But when I buy a coin directly from someone, I inspect the piece and grade it according to my experience, knowledge and personal assessment. In many occasions, I find third-party grading over- or under-graded. Especially on foreign coins.
Yes, and Maybe. A time-consuming, difficult, crap-shooting, and expensive process. Often disappointing, sometimes elating.
My answer to your question is “yes.” I jumped on the third-party bandwagon early and at some point decided that all of my coins should be certified and graded. The two big advantages are that my heirs will find it easier to sell my collection for a reasonable amount if the coins are already graded and encased in plastic. Also, the slabbed coins are protected, and heirs are unlikely to clean them if in slabs. In my opinion, if your coins are worth enough to warrant the expense, they should be certified by one of the major certification services: ANACS, NGC, PCGS. My preference is for PCGS, as their coins tend to bring more money.
I only have a couple of coins that have been graded by a third party, and these were either given to me as gifts or bought as a part of a lot of coins. My feeling is that third-party grading started out as a worthwhile endeavor, as there is a need for impartial grading of very high-end coins, coins where the difference in a grade can mean hundreds or thousands of dollars. Of course then the grading services decided you couldn’t make enough money that way and began to grade common coins such as common Morgan dollars for investors who had no knowledge of the art of grading. These common coins included Statehood quarters and other issues where the cost of the grading exceeded the value of even the best coins.
In my opinion, most slabbed coins today are not worth the added value. I see the snake oil salesmen on the coin-selling channels late at night selling current issue or other common date coins at a value of two, three or four times book with the explanation that the professional grading insures the value can only increase in the future. I see people on Craigslist years later trying to sell these coins for what they paid for them and having no takers.
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• The Standard Catalog of World Coins, 1601-1700 is your guide to images, prices and information on coins from so long ago.
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