There is nothing quite like the feeling of sending in a “raw” coin to a third-party grading company, such as PCGS or NGC, and receiving it weeks later with an official designation about its mint or proof state, along with other attributions (varieties and the like).
You may notice that I am not saying whether the feeling is good or bad. It can be either or both.
We’re adding a column on third-party grading in Coin Update to help you feel good about your holdered (or “slabbed”) coins and to feel bad less frequently, making you a better collector or savvier investor in the process.
Grading is subjective. How many times have we heard that? The truth is, grading is subjective to a point.
Let’s illustrate that. A Lincoln cent is designated by the color of its metal, with “red” being the most desired attribute, followed by “red-brown” and “brown.” You wouldn’t anticipate a top-tier grading company—PCGS, NGC, ANACS, IGC—to dub a brown or a red-brown coin, red.
I’ve seen bottom-tier grading companies call a brown coin red-brown or red if there is even a hint of the original copper luster.
Technically, an uncirculated “red” cent should be as new as the day it was minted. That could be a bad day (MS-60 to 62), an average day (MS-63 to 64), a good day (MS-65 to 66), a fabulous day (MS 67-68); or a miraculous one (MS69-70).
You wouldn’t expect a top-tier third-party grading company to inflate an MS-60 cent by three or more grades, to MS63 or higher. But bottom-tier companies might inflate the grade by five or more points, especially if the cent is red.
Why the discrepancies? It’s business, not personal. The top-tier companies earned their reputations because they are more objective than the others. They bank on objectivity, literally. Others companies are content to inflate grades because they want to please the customer who patronizes them.
But if you’re a buyer, you may suffer remorse when you learn that your over-graded 1972-S MS 66 red cent is not worth $300 but 6 cents, because it is MS63.
If this sounds like a commercial for PCGS or NGC, rest assured that I have my own beefs with them. I’ve sent in error and variety coins to NGC, only to get back the coin graded in mint state but without the attribution.
That has happened to me more than once, and I’ll discuss a recent case in an upcoming column.
As for PCGS, since it started slabbing as “genuine” coins it would have returned in the so-called “body bag,” or plastic flip, I’m thinking it uses that designation too often when there is a question about a coin’s luster or tone.
We’ll look into all of these issues in Coingrader Capsule, to appear at least monthly in Coin Update.
We’ll not only look into grading, but also at coin collecting topics in which the grade, condition or attribute of a coin plays a role, especially in online bidding, an increasing numismatic phenomenon.
And we’ll do so in “capsule” or summary form so that you get concise, factual information, as you’d expect from Coin Update.