Coin Grading Methods
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A knowledge of coin grading methods is a necessity for any coin collector. It is important to have some idea of coin grading standards so that a collector can obtain the best value as he or she continues to add to a collection. Whether searching through a tray of coins at a garage sale or staring through the glass at a showcase in a dealer's shop, it is good to have some idea about the value of the coins one wishes to purchase. The time may come when a person wishes to sell their own collection. Perhaps a non-collector who inherits a set of coins may wish to liquidate the collection. In each of these situations, an awareness of coin grading methods will be helpful in order to receive the best price for the transaction.
As with any other pursuit, educating oneself about coin collecting can result in greater enjoyment of the hobby and save the collector from costly 'beginner' mistakes. For example, avoid purchasing coins from home shopping advertisements found on the television. These outfits are reputed to charge unsuspecting customers several times an item's actual value. Other dealers may arrange coins which are only slightly valuable in special sets with attractive packaging at inflated prices. Happily, coin grading standards and books are available to help keep the collector from stumbling over such 'bargains'. Many of the books have pictures to aid in identifying an item's grade.
Collecting used to be reserved for wealthy individuals. Others were probably too busy just surviving to have time for such pursuits. If one did have time for a hobby, it would probably be one which helped provide for family needs (like hunting) or produced crafts to sell for additional income. Also, people generally did not collect their own coinage, but preferred coins from some exotic place. Even now, sets of coins from around the world are popular, especially with children who are just beginning to explore the hobby. This can help develop an interest in exploring other places and cultures.
These days, everyone seems to be collecting something. There are few items which are not being collected. Some retailers seek to take advantage of the public's collecting frenzy by marketing merchandise of all grades of quality in sets or collections. Coin dealers are not immune to this strategy. Some will employ unscrupulous coin grading methods. People will buy just about anything if it is attractively presented. The desire to complete a set may become nearly compulsive. One is reminded of the words found in Ecclesiastes 5:11 -- When goods increase, they are increased that eat them: and what good is there to the owners thereof, saving the beholding of them with their eyes? Collecting can be an interesting hobby; however, this should not become the focus of a life.
At first, many collectors are primarily concerned with obtaining various examples of coins which interest them. As time goes on, though, they may want to obtain coins which are the best example of that particular type. Although professionals may evaluate an item according to the quality or characteristics of the die that produced it, or even of the metal blank itself, most collectors are concerned primarily with the coin's conditon and the amount (or lack) of damage or wear which is evident. There are also subjective qualities that are desirable, which add to the appeal of the item. This leads to a problem in coin grading standards. What if two people assign a different grade to the same object?
Coins used to be described by various adjectives, according to their appearance. These terms eventually settled into accepted coin grading standards like 'poor', 'good', 'fine', and 'uncirculated'. However, when a coin seemed to fall into a category which was somewhere in between, further degrees of description were required. After all, a collector would not pay 'fine' prices for items which were not quite at that level, while dealers did not want to sell a coin which was better than 'good' at a lower price! Therefore, additional levels such as 'very good' or 'nearly fine' helped distinguish (and price) coins which were between levels.
Third-party coin grading methods brought about additional fine-tuning to coin grading standards. A grading scale developed by Dr. William Sheldon in 1949 only became widely accepted after third-party grading arose in the 1980s. His 70-point grading system remains in use today. At present, there are three tiers (levels) of third-party grading. The first two tiers have only two companies in each, a grouping which developed over time by popular consensus. The first tier has undisputed dominance, for it offers two (and, if necessary, three) independent evaluations of the coins submitted to the company and guarantees their grades and the authenticity of coins in company holders. The second tier offers similar experience with a lower price and faster results, but does not have the continuity in management and standards that the first tier companies enjoy. The third tier is composed of every other company in the business. Some propose a five tier system, in order to help distinguish between legitimate (yet perhaps new or smaller) companies and others who engage in coin grading methods which can only be described as fraud or scams. However, even if the tier system continues to develop, the responsibility to be aware of various citeria for determining value will continue to remain with the collector.
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