Gold Coin Grading & Certification

On my first visit to the local coin shop (that opened up this spring), I noticed a coin in a plain cellophane and cardboard coin holder marked MS66. I asked the owner who graded that coin an MS66 and he said "I did. I grade coins too". I was more than a little surprised.

When you start considering the purchase of coins in the higher MS (or Mint State) grades, you must be very careful . One grader of coins may rate a coin MS66 while another may grade the same coin at MS64 and money, sometimes lots of money, can be lost. Let me give you an extreme example...

A 1907 St. Gaudens High Relief Gold Double Eagle graded MS64 is currently worth approximately $26,000. That same coin graded MS65 is worth approximately $46,000. So let's say you bought that coin as an MS65 from a dealer who a few years later went out of business. When you go to sell the coin to another dealer, he says "Nope, in my opinion this should only be MS64 and I will pay you what an MS 64 is worth". That is how investors can lose lots of money.

The solution? When purchasing coins from dealers in the higher MS grades, make sure they are graded and "slabbed" (encased in plastic) by either PCGS (Professional Coin Grading Service) or NGC (Numismatic Guarantee Corporation). This is insurance that the quality of coins you think you invested in are of that quality.

I will talk more about these two organizations in another post.

Happy investing!