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Thursday, March 16, 2017

How much is it worth?

I'll get back into the two most common questions:
What is this?
How much is it worth?

Assuming the coin has been identified and accurately graded, it's a fairly simple matter to look up the value.  There are books, magazines, and websites that have price guides.

Coins Magazine
This was a staple for me growing up.  I cut my teeth on it.  It was a couple bucks, had interesting articles, a pricelist for everything, and classified ads.  It's 5 bucks for a copy if your local bookstore carries it.  Subscriptions are less than $23/year, 12 issues 

Coin World Magazine
Just as good as Coins Magazine.  They have a web presence with a searchable database for coin prices.

Dealer Pricelists
Back in the day there was no such thing as online buying.  I sent off for pricelists, received them in the mail.  No photos, just a list of coins with grade and price.   Every month, I'd get another pricelist in the mail. 

Redbook
Probably the best known book listing US coin values.  Updated annually.  Around 15 bucks for hardcover.  I guess they have some MEGA book out this year but I've not checked into it.

Blackbook
Plenty of information.  Has a grading section which describes the condition of each coin in each grade.  About 10 bucks, paperback.

Greysheet
Updated every 2 weeks, this is a staple for dealer to dealer prices.  Every quarter they produce a comprehensive pricelist with updates for everything.  Everything.

USA Coin Book
An online sales platform much like eBay, but just for coins.  The pricelist is easy to navigate but the prices are somewhat higher than reality.  I suppose this is a strategy to get higher bids, on which they draw a 2% commission.

Numismedia
I think this is the most accurate representation of fair market values available online

Coins and Canada
For Canadian coins, this is the best I've found.  See also Saskatoon Coin Club

eBay
No pricelist here, but you can get an exact listing of what has sold and for how much.  Look to the completed listings.

PCGS
The old adage "Buy the coin, not the holder" is sent packing.  What you have here is a proprietary price guide.  These prices pertain only to PCGS graded coins.



NGC
As with PCGS, NGC prices reflect NGC graded and slabbed coins.  Usually lower than PCGS.  NGC offers price guide for many world coins

Now let's shred all of this...
Price guides are not an exact science.  They are not written in stone.  There are no rules.  What you get in these pricelists are market analysis.  Each producer of these pricelists creates the list in a different fashion.  Some are based on auction records.  Some use algorithms about which I can offer no insight.  Some are updated frequently, others annually, and a few I have no idea what they are thinking.    I don't know if they are all simply using the Redbook in their figuring.  For higher grade coins with auction records the prices across all these different guides is fairly consistent.   For low grade, low value coins, again, they prices are within the same ballpark.  The stuff in the middle tends to have greater variance from one guide to the next.  Some of this has to do with spot price.  With a volitile market, the value of silver or gold can swing significantly over the course of a year.  One guide puts out it's figures once a year when the price of silver is up, another guide puts our different figures at a time of the year when the silver market is down.  While the calculating of price was accurate when the price guide was published, change occurs in the real world.  Fact of the matter is coins are traded through negotiation.  Several buyers interested at the same time on a specific coin can drive price up sharply.  Supply and demand are the drivers of market value, not price guides.  If you need up to date, accurate fair market value estimates, you have to do your own homework and come up with your own estimate.  Compare several prices from several guides. 

I primarily handle cents so I'll talk about them.  Cents have that tonal description: Red, Brown, Red-Brown.  I look in a price guide, I see a value listed for MS-65.  This usually refers to a full red specimen and may not reflect the value for BN or RB specimen.  Some price guides only list prices for MS-63, and offer no explanation of tone quality.  Does it still refer to Red?  Maybe.  If it does, there is often no reference or listing to what a BN or RB specimen in that grade is valued at.  Some do, but not all, and those that do don't cover all grades.  You've got a MS-63 in full red, but the guide does not start listing prices for full red until MS-64.  You are left in limbo.

On the other end of the spectrum are the low grade, low value coins: circulated wheats, Good Indian Cents, VG Roosevelt dimes, partial date Buffalo Nickels.  The price guides may offer a value of 50¢ for a Wheat cent, but that does not mean you will ever realize that sort of market price.  Who's going to spend 50¢ to a buck on a coin, then another $3 for shipping?  Back when I was a kid I'd hit the local coin shop with a couple dollars and buy a 1948-D Wheat for 15¢, plus sales tax and I was a happy kid-one more knocked off my list.  I watch videos of people coin roll hunting, pulling out wheats like they've won the lottery.  They end up with 12 wheats in a box and they are about to pass out from the excitement.  That one date is not really worth the 9¢ the book says, even if you have 100 of them.  What you have is a function of the algorithm that is projecting values based on information fed into the computer.  Look around at how those wheats are sold, you'll see 4¢ is closer to reality, and to get that 4¢ you need 5000 pieces.  Sure, you can gather that many from circulation, but you may have to hunt through 400 boxes, 1 million pennies, to find them. 

There is a big difference in values listed and prices that can be realized.

For the middle of the road coins, the Very Fine 1927 Wheat, XF 1935-D Buffalo, AU 1945 Merc, the price guides are a fair approximation and quite stable.  These go into sets, people buy several coins at a time, throw one on these in the stack while they are at it.  These are standard issure, run of the mill, older and more common.  The prices won't see sharp spikes or drops.  Publishing new price guides for these coins every other week or even quarterly is a waste of ink.  The Redbook price from a couple years ago will still be as accurate, within a few cents, as the most recent edition.  For most new collectors who came across  a circulated business strike and wants to know what it's worth, a magazine from 5 years ago will be close enough to work with.  There's not much difference between a price guide that says $14.50 in their publication 5 years ago and $15.50 today.  You can lose half that difference by messing up a shipping label. 

As a hobby, time is not usually included in figuring value or net on the sale of a coin.  You'd like to make $20 an hour selling coins but spend half an hour photographing a $10 coin.  That local shop with the 15¢ wheat was not investing in a coin.  He was investing in a coin collector.

Price guides are just that: guides.
They are not written in stone.  They are not gospel. 
Each price guide out there has a different algorithm used to generate the data.  One price guide may offer a value of $50 for a coin while another can show $100.  Checking several guides, as well as auction records will offer a better range of value estimates.

Experience is the best guide of all.

What price you can realize can be far from the values in a guide.An experienced seller with an established reputation, well developed clientele, and active marketing practices will command a far greater price than a hobbyist looking to part with some extras.

Is a coin worth 10¢?
Is it worthwhile to try to sell a coin for 10¢?
Perhaps a roll of 50 coins in the grade shown will fetch $5 from a well known seller.
It may be that you can only reach $3 for those same coins with the buyers you know.

These are collector pieces.  There is no set price.  Prices are realized as the result of negotiation.  Buyers are often willing to be more flexible with a reputable seller.  Sellers can get higher bids when they have established a large customer base.  Someone with no reputation and no history with any buyers will probably experience disappointment if they show up expecting top dollar for their goods.

4 comments:

  1. Thank you Ken for your amazing insight and knowledge..you are awesome !!

    ReplyDelete
  2. As for european coins I highly recommend coinstrail.com

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  3. This comment has been removed by the author.

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  4. I can recommend a good site for estimating the value of German coins and Spanish coins. This information will help you make a buying and investment decision.

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