Assigning a grade to a coin is an art, not a science. It is often highly subjective, especially when working with Mint State coins where small differences in grade make big differences in price. Even so, grading can be studied, learned and applied with known and predictable results that ultimately rest on judgment, rather than "feeling."
Like any science, language, sport, or field of study, it is
best to break grading down to its basic components, and master them one at a
time. Learning how to grade coins is much the same as learning how to speak
not try to learn it all at once, but through experience and study.
The essence of grading a coin (once you have determined it is uncirculated or proof) can be broken down into four distinct factors:
1. Surface Preservation - This includes the presence of bag marks, hairlines from cleaning or mishandling, and other imperfections of planchet, whether mint caused or man made. An analysis of surface preservation attempts to weigh the visual impact of these imperfections based on their degree of severity and their location on the coin.
2. Strike - Refers to the sharpness and completeness of detail, with the normal characteristics of that particular type, date and mint mark (i.e. issue) taken into account.
3. Lustre - This encompasses the brilliance, cartwheel, sheen and contrast of the coin, again taking the normal characteristics of the particular issue into account. Minor (non-hairline producing) cleaning, retoning, friction, etc., are evaluated under this category.
4. Eye-Appeal - That certain aesthetic appeal that results from the attractiveness of the toning (if any), the balance of the coin, and the effect of the combination of all of the coin's qualities.
Surface Preservation is the single most important factor in grading mint state coins. The other three factors appear to be approximately equal in value, each about half as important as surface preservation. (i.e. 40% + 20% + 20% + 20% = 100%). Actually, this formula is somewhat arbitrary since it is really a function of the standards of the scales used for each of the factors themselves.
PCGS - The Professional Coin Grading Service began serving the
coin-buying public on February 3, 1986. The firm is responsible for dramatic
improvements throughout the rare coin industry which have forever changed the
way rare coins are bought and sold. In addition to standardized grading.
a cash-backed grading guarantee, problem-free coins, safe long-term storage,
and sight-unseen trading. Together, these elements have created unprecedented
public support for the rare coin industry. Since 1986,
PCGS has graded
over 9 million coins with a cumulative declared value of over 16 billion
NGC - NGC was founded in 1987, hundreds of thousands of coins are submitted to NGC each year by collectors and dealers who have confidence in our ability and integrity as a third-party grading service. Their grading process involves numerous steps within several specialized departments. Each step is performed with the goal of accurately and safely grading and then sonically sealing coins in NGC holders.
General Grading Standards for U.S. Coins
Good (G) - Coin will be heavily worn, but the main design and legend will be visible. Lettering may be worn smooth. May be dull or faded areas.
Very Good (VG) - Still well worn but more of the rim will be evident. Design and legend will be clear but worn flat. Lacks specific details.
Fine (F) - Medium to heavy wear but even overall. The design becomes clearer and details begin to appear. Some letters within the design will be apparent.
Very Fine (VF) - A visibly nicer coin. High spots will show light, even wear. Various major features are visible. Lettering is all readable.
Extra Fine (XF) or (EF)- Slight wear will show on the highest points of the main devices. Words are sharp and easily readable. All details are clearly defined.
AU 50 - Slight traces of wear on the highest points of the coin; may be dull with some evidence of luster under any toning.
AU 53 - Just slightly better than an AU 50 with a little more luster visible. Eye appeal begins to make a difference between the AU grades.
AU 55 - An obviously nicer coin than an AU 50 with no major difficulties. More luster shines through the surfaces.
AU 58 - This is oftentimes called a slider as it will appear to many observers to be uncirculated. Just the faintest wear on the highest points of the coin. Luster should be quite evident, although some toning can be apparent. Usually coins with poor eye appeal will not make the AU 58 grade.
MS 60 - Mint State indicates a coin that has no wear and is uncirculated. It may have numerous bagmarks and/or be toned. MS 60 is the lowest quality of an uncirculated coin.
MS 61 - An uncirculated coin that is just slightly better than MS 60. However, no question that it is uncirculated. Whereas, some may debate over the merits of a coin being MS60 because of the excessive bagmarks, the MS61 should be more desirable.
MS 62 - This coin should be a much cleaner specimen than an MS 60, yet, just slightly better than an MS 61. There should be fewer bagmarks as the coin takes on more attractive features.
MS 63 - This is the grade that many collectors feel is the most collectible in numismatics. Prices are typically reasonable compared to higher grades and the coin should have at least an average strike and eye appeal, with minimal distracting marks.
MS 64 - This is the grade where prices in many series begin to increase dramatically. For this reason the coin will begin to show fewer marks and the strike will be the strongest yet. No primary distractions that will draw your eye. A near-gem coin with just a few tiny marks or weakness in strike to keep it from a higher grade.
MS 65 - This is the gem category. Coin should be fully struck with eye appeal. Either brilliant or toned but there should not be any unsightly marks or color that negates eye appeal. Any marks should be very minor in appearance. Prices spread out even further.
MS 66 - A coin that just jumps out at you as being nicer than an MS 65. The main devices on either side should have no more than very minor ticks and the fields should be cleaner than that of an MS 65.
MS 67 - A superior coin that has no major distractions to speak of. The fields should be near flawless with just the slightest contact on the main device. This coin should emit a look of satisfaction from the viewer. Prices increase further especially for coins with short supplies and strong demand.
MS 68 - A difficult grade to determine by most experts. When does a coin become MS 68 but is not quite MS69 or 70? A very superior coin with maybe just a minor tick on either side keeping it from perfection.
MS 69 - This is a coin that should create a gasp when viewed. There should be no imperfections to the naked eye. With a magnifying glass a minor mark or impediment may be visible.
MS 70 - A perfect coin with no imperfections seen with a magnifying glass. There should be no marks whatsoever; the coin must look like it just left the Mint. Very unusual in early coins as the mint did not have the quality they do today. Modern coins have been given this exalted grade although there is debate whether coins can be perfect.
As you proceed to higher grades, there should be a noticeable difference in each grade and an improvement in quality, strike, and eye appeal. However, since grading is subjective, it will still be difficult for most numismatists to see a distinct difference from one grade to the next. This is especially so in grades of MS67 and higher.
Any kind of damage or cleaning will downgrade the potential value of a coin.
The Sheldon Scale
In 1948, a well-known numismatist by the name of Dr. William Sheldon attempted to standardize coin grading by proposing what is now known as the Sheldon Scale. His scale, which runs from one to 70, was originally devised specifically for large cents, but it is now applied to all series. The Sheldon Scale was a vast improvement over grades such as "good" and "fine".
|Common, readily available
|Less common - Available at most shows, but in limited quantity
|Scarce - somewhat difficult to find, only a few likely at larger shows
|Very scarce - may or may not find at larger shows/auctions
|Rare - unlikely more than 5 at shows or auctions each year
|Very rare - Almost never seen, only one may be offered for sale in a year’s time
|Prohibitively rare - one may be offered for sale once every few years
|Unique, or nearly so
|Full Bell Lines
|Deep Mirror Prooflike
|Surface: DC (Ultra Cameo)
|Branch Mint Proof
Is It Proof or Business Strike?
One of the most difficult parts of grading is distinguishing a "first strike" or proof-like" uncirculated (i.e. business strike) coin from a proof It is important to remember that "proof 'is not a grade; it is a method of manufacture.
Proof coins are graded in a similar manner to business strike coins (i.e. Proof-1 through Proof-70). A coin which exists only as a proof, such as an 1895 Philadelphia mint Morgan dollar (if you believe, as I do, that all business strikes of that issue were melted) that is worn down to Very Good-8 grade, for example, would still merit the grade Proof-8. Of course, some proof coins are impossible to distinguish as proofs once they are worn beyond a certain point. Therefore, circulated proofs may also be graded by their circulated grade level (i.e.. VF-20 or AU-50), especially when there is some doubt as to their proof status.
When you attempt to discern between mint state and proof coins, always remember that proofs are specially made coins. They are struck under greater pressure than most business strikes, and usually they are given two or more blows of the die. In addition, they are struck on specially made, polished planchets, using polished dies (in the case of brilliant proofs.)
Therefore, consider the following factors in tandem with each other, for no single factor is enough to make a conclusive decision:
Proof Surface - A brilliant proof should have a mirror surface. In most cases there will be little if any frost (i.e. cartwheel) in the fields. There will be full mirror surfaces even in the protected areas of the field, such as between the vertical lines of the shield, in the case of Seated Liberty coinage. Matte and Roman finish proofs will also lack cartwheel, and will have either dull or satiny surfaces.
Of course many business strikes have mirror or prooflike surfaces. Both prooflike business strikes and proofs will usually have some hairlines. However, business strikes are far more likely to have bagmarks as well as hairlines.
Strike - Proofs tend to be somewhat sharper than business strikes. In fact, most proofs are fully struck. There are a number of exceptions however. The most common exceptions in the Morgan dollar series are the proof issues of 1891, 1892 and especially 1893. These dates are often found weakly struck in the centers.
Edges - Most proofs will have either square edges, or wire edges in the case of some matte and Roman finish proofs. Business strikes usually do not have square or wire edges.
Die Variety - Proofs were usually struck from one or two pairs of dies, and these dies were often used solely for proofs. Therefore, any coin struck from proof dies is at least somewhat more likely to be a proof. Die variety, while not conclusive, can be an important factor in determining proof status.
Lint Marks - Proof dies and planchets were usually polished with soft cloths. Occasionally, pieces of lint would adhere to the die or planchet prior to the striking process. Therefore, lint marks are fairly common on proof coins, yet rare on business strikes.
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