Grading Coins

The science of grading coins is not the same as the science of physics or mathematics, where formulas yield an answer “Z”, given inputs “X” and “Y”. No, grading coins with great precision is a talent, resulting from the nexus of knowledge, experience, and practice.

Fortunately, the novice coin collector need not be intimidated by the subjectivity aspect of grading coins. Any person, even a newcomer, can develop enough skill and confidence to approximate the condition of nearly any coin, through diligent reading and studying as many coins as possible, whose conditions are already known.  The first step in gaining a clearer understanding of how to grade coins is to acquire the “bible” of grading coins, the Official ANA Grading Standards for United States Coins. Written by longtime veteran numismatist Kenneth Bressett and produced by the American Numismatic Association, this valuable reference is the foundation upon which all other coin grading books are written, and deserves a place in the personal libraries of all coin collectors. We strongly recommend it, especially for people wanting to learn the basics.  Full Review here.

An important sidekick publication, Photograde, is also recommended.  Designed for beginners and advanced coin collectors alike, every regular issue United States coin type from 1793 to date is illustrated, many of them enlarged to show greater detail. For an detailed look at what Photograde has to offer, we have an online review (18th ed.).

Both these books are world class, and are the only books you will ever need to purchase on the topic of grading coins.

If you’re looking for an excuse to travel to Colorado anytime soon, consider the American Numismatic Association’s “Grading US Coins” seminar. The course consists of reviewing ANA grading standards, hands-on practice, slide presentations, and more. For lack of a better description, this is a “crash course” on becoming an expert at grading coins. Check out the ANA's Educational webpage for course schedules.

Another top-of-the-line coin grading book worth recommending is The Official Guide to Coin Grading and Counterfeit Detection The Official Guide to Coin Grading and Counterfeit Detection, Edition #2.  The book was produced by the grading experts at Professional Coin Grading Service, better known as PCGS, and edited by coin collector "Superman", Scott Travers.  PCGS is one of the oldest third party coin certification companies, beginning operations in the 1980's.  It is regarded by most collectors and dealers alike as one of the best grading services of all.

Their many years of experience are distilled into a single, compact volume, and is laden with essential information designed to graduate the ordinary collector into the realm of advanced numismatist. Click here for a review of this valuable reference.

Going back to the 1950s and before, coin grading was limited to a few adjectival terms, such as Good, Fine, Uncirculated, and Proof. Accordingly, numismatic references of those times conformed to the same set of adjectives to approximate retail coin values.

The importance of grading is magnified by the case of the 1892-S Morgan silver dollar.  The first 1892-S above graded AU-58 because of slight wear above Liberty's ear. The second specimen, with no wear and only a few scratches, was judged as an MS-65 grade. To the uninformed, there may not appear to be much difference between the two, but in the open marketplace, the MS-65 sells for $200,000, while the AU-58 is generally valued at around $15,000. Photos courtesy of Ira & Larry Goldberg Coins & Collectibles, Inc., Beverly Hills, CA.

Varying distinctions of Uncirculated (today's equivalent of MS-60, MS-63, etc.) and Proof were recognized in some advertisements and auction bills by employing modifying descriptors such as "Gem Uncirculated" or "Choice Proof", for example. However, with no clear point of reference or consistency on how the modifying descriptors were invoked, most publishers resorted to listing values for only one "Uncirculated" grade and one "Proof" grade.

In the late 1970s, as coin prices escalated dramatically, most notably for pristine, high quality specimens, varying distinctions of "Uncirculated" and "Proof" became evermore critical. Descriptors "Choice" and "Gem" were replaced by numerically assigned grades, utilizing the newly developed 70 point ANA scale, based on a numeric system introduced by Dr. William Sheldon in the 1940s. Uncirculated coins were differentiated as MS-60, MS-65, or MS-70. A few years later, grades MS-63 and MS-67 joined the fray. Although not applied consistently (a situation that gave the coin business a black eye), the practice of assigning a numerical grade to indicate quality was universal by the mid-1980s, and eventually brought some standardization to coin collecting that was absent as the hobby passed through its formative years.

In February 1986, the ANA changed its grading interpretations to match the tightening standards demanded by the marketplace. This meant that many coins correctly graded as MS-65 in the early 1980s became MS-63 or less, so as to be consistent with the newly revised interpretation. Conversely, a coin graded after 1986 as MS-63 was about equal in quality to an MS-65 before 1986. Thus, the Mint State prices published in numismatic periodicals prior to 1986 are not directly comparable to those published later. The Coin Value Tables of this website relied heavily on periodicals from before 1986, but we did not attempt to compensate for the revised grading standards of 1986; we reported what we found. One must take this into account when studying trends for an MS-65 coin from, say, 1980 to the present. On the other hand, because of the dearth of Mint State price estimates published prior to 1986, more than 98% of the Coin Value Table data is not affected by anything mentioned in this paragraph!

Throughout the 1990’s and into the new millennium, more grading subtleties were introduced within the framework of the grading system, such as the wider acceptance of “in-between” grades MS-62 or MS-64, or coin coloration, for example.

Though not perfect, the numerical grading system brought more consistency to the coin collecting hobby. Our Coin Value Tables reflect the historic availability of numeric grades to describe coins.

The process of coin grading is highly subjective. Even though talent and experience is the key to grading coins accurately on a consistent basis, beginners can come reasonably close to approximating grades with a few simple guidelines. The American Numismatic Association's 1-70 point numeric system is frequently invoked to assign coin grade. The following grades and descriptions are the most recognized milestones on the typical coin grading continuum.

Complaints over inconsistent grading practices reached a crescendo by the mid 1980s. While one dealer might assign a coin a certain grade, another dealer might give the same coin a slightly higher or lower grade.  In the numismatic profession, subtle grade differences can mean literally thousands of dollars in trading value. In 1986, PCGS began offering third party grading services, for a fee, to be joined the following year by NGC. Coins submitted to these coin grading companies were evaluated by a panel of experts.  Each coin was then encapsulated in a tamper evident container and returned to the sender.  By the late 1980s, the coin grading companies captured the trust of the coin industry, at last providing some much desired consistency in grading coins.

The impact of the coin grading companies was enormous. Encapsulated coins (known as “slabs” by insiders) became highly liquid commodities, being traded readily by confident buyers and sellers, often sight unseen. This activity won the attention of millions of first-time coin buyers and several Wall Street brokerage firms, pushing the slab market to dizzying heights by the spring of 1989.

Eventually, many slabbed coin prices plunged back towards reality as the coin grading companies began releasing their population reports. These reports indicated how many of what types and coin grades passed through their systems, thus revealing a more likely approximation of each coin’s true scarcity. Especially had hit were the common date coins, which even in very high mint state conditions were much more abundant that realized just a few years earlier. In the early 1990’s, the great run-up of the 1980’s crash landed to become nothing more than a memory. Around 1995, the market began a slow ascendancy, then picked up momentum at the very end of the 20th century, and carrying all the way up until today, in spite of a challenging economy.

The coin grading companies have forever changed the face of coin trading. Though not perfect, the concept of third party coin grading has proven to be a stabilizing effect and have earned a permanent role in the coin business.

There are quite a few coin grading companies operating today. What follows is a list of the most widely known grading services, listed in alphabetical order. Please note the descriptions below were provided by the companies themselves. Grading services that are among the most trusted by experienced numismatists are: ANACS, ICG, NGC, and PCGS, not necessarily in that order. This is not to say that some of the others are not good.

For readers who would like to see examples of slabs issued by most of these services and then some, we recommend a visit to a coin grading companies summary page, where photos are placed side-by-side for comparative purposes.