The value of a collectible coin is primarily based on three factors:
(1) Rarity, or scarcity.
(2) Condition, most often graded on the 70-point scale devised by William Sheldon.
(3) Damage, for example holing, scratching, or cleaning.
A customer who brings a coin to a dealer at a reputable coin shop or a show will be offered a price around or below wholesale. Most dealers use the “Grey Sheet,” short for The Coin Dealer Newsletter, as a starting point for a price offer. The “Grey Sheet” is published weekly, so it reflects current market value. It is also available online for a subscription fee at www.greysheet.com.
Another method is to offer a percentage of the retail price. Many price guides are available in print, including A Guide Book of United States Coins (the “Red Book”) and Coin World’s Coin Values. The user should be sure to use a current version of any printed pricing material, as prices can be volatile. Current retail prices are also readily available for free at websites like www.pcgs.com/prices/default.aspx and www.ngccoin.com/poplookup/NGCCoinPriceGuide.aspx. Most online price guides are available for smartphones too.
Price guides are typically formatted as tables, with one table for each type of coin. The price for a coin is found by finding the row for the issue, then going across the columns to the condition that the user feels the coin is in. So here’s the rub for most sellers that are not immersed in the world of coins: How do they determine the condition (grade) of the coin?
Many books describe the process of determining the condition (grading) a coin, but even the best of these require a large investment of time to grasp, and accurate grading requires years of experience. One relatively new resource that allows the seller to determine a good guess at the grade of a coin is at www.pcgs.com/photograde/. This website shows images of each type of U.S. coin at selected grades on the Sheldon scale. For example, if the user is interested in determining the condition of his Washington quarter dollar, he can view images of Washington quarters in specific grades from the Sheldon scale (e.g. Mint State 63). An examination of these images allows the user to determine an approximate numeric grade.
Another way to approximate a retail price for a coin is to use the search box on eBay (www.ebay.com) to find other examples of the coin you are trying to price. For example, if the user searches for “1893-S Morgan dollar” using eBay, about 100 matches will be found. The important thing to do is to narrow down these matches to those that were traded at an actual price (ignoring those that the seller is asking unrealistic values for). The way to do this is to find the “Show only” section on the left side of the display. Under “Show only” is a box labeled “Completed listings.” Click on this box and the display will show only completed listings. The prices will be shown in red or in green. The red listings failed to produce a sale. The green listings show the prices of a successful sale. These prices are some of the best pricing data available online.
Damaged coins are discounted from their full value by factors depending on the type and amount of damage. A light cleaning might bring a discount of 20 percent to 40 percent while heavy surface damage might bring a discount of 50 percent or more. This pricing adjustment is more of an art than a science.
When a potential seller is interested in maximizing the price, he can opt to sell the coin in the retail market. The most easily accessible retail markets are on the Internet, and include sites like eBay, Amazon (www.amazon.com), or Etsy (www.etsy.com). Etsy is not as well established as eBay or Amazon but charges significantly lower fees to sell coins.
An additional alternative is to consign the coin for sale through a vendor that sells it for a fee, typically a percentage of the price realized for the coin.
Whether the seller decides to sell at wholesale, at retail or on consignment, some due diligence should be exercised. To avoid being underpaid, the seller should determine an approximate retail price for the coin before going to the coin dealer or selling online. When a higher-priced scarce or rare coin is involved, the seller should also take the coin to two or three dealers to get the best price.
So what is that coin worth?
Tom Deaux is the proprietor of Coin Store & Gold Exchange in Marlton, N.J.