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Michael Bugeja

Online Coin Auctions

Michael Bugeja

Michael Bugeja, a coin collector since childhood, is a professor at Iowa State University and also a former member of the Citizens Coinage Advisory Committee. He is a nationally known author, journalist and educator.

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Archive for 'July 2016'

    Paying for Coins Online

    July 29, 2016 7:15 PM by Michael Bugeja
    Buying and bidding on coins via the Internet is convenient, offering a wider array of options for the hobbyist collecting any denomination, date set or rarity. There are many payment options, too, and some of them are risky.

    Proxibid mainly uses the Auction Payment Network, but sellers do not have to subscribe to the service. APN is a safe way to bid, offering security options that other venues lack. When an auctioneer uses APN, the credit card on file with Proxibid is charged after each session. 

    However, not all Proxibid sellers use APN. Here's where it gets risky. Some sellers ask that you contact them via telephone or (yikes!) email with your credit card number, including expiration date and CVC code (the three numbers on the back of the card).

    Some bidders realize this too late because they failed to read the terms of service. Once you phone in or send your credit card information, there is no way to tell what the auctioneer will do with it. Perhaps the company stores it on a computer that other employees have access to, or worse, that can be hacked.

    As a rule, I never call in credit card information. If you learn about the payment option too late, call the auctioneer and ask if you can send a personal check or bank check. You'll likely wait longer for your coins as sellers must wait for checks to clear.

    Some Proxibid and most eBay sellers use PayPal, another secure way to send funds. PayPal likes to link directly to your bank account, and in that case, you're not getting reward points for using your credit card. Think about that. If you win a $20 Saint-Gaudens gold coin at $1,700 with buyer's fee, you just lost $17 or more.

    Also, if you link directly to your bank account, and something with the sale goes wrong, it may take up to 30 days for the funds to be credited to your bank or PayPal account.

    PayPal does allow you to link to your credit card if you want to claim reward points. There is no charge for this. Again, if a sale is canceled, you'll have to wait a month for accounts to be settled in your favor.

    Auctioneers hate charge-backs so do not use your card to do that unless you have a real dispute, such as purchase of a counterfeit coin. You can be looking at extra fees if you attempt to cancel a transaction due to buyer's remorse.

    Finally, always read the terms of service before deciding how to pay for your lots. You can save yourself time and, most important, money.  

    Bidding on Raw Coins in Online Auctions

    July 22, 2016 8:51 PM by Michael Bugeja
    ​My last post explained how to research coins slabbed by top grading companies, checking latest auction prices and factoring in buyer's fees and shipping. Bidding on uncertified coins is much riskier, and the research much more involved than looking up certification numbers and latest auction prices.

    One of the very best resources on the Web remains PCGS Photograde Online . There is even an informative video on the website that explains how to grade so that you can determine whether to submit to PCGS, considered one of the top two holdering companies with NGC.

    I don't recommend bidding on raw coins in Proxibid, eBay or other online venues unless you know how to grade and can tell condition issues like cleaning, alternation, environmental damage and more. Even if you can do that, you should only bid with auctioneers who provide sharp photographs and charge reasonable shipping and buyer's fees.

    Also, never believe the description on the flip. Consignors and auctioneers who represent them tend to inflate value--the reason, by the way, that third-party grading companies came into existence.

    Currently I am bidding in an online auction on Proxibid with a seller who knows how to grade and generally does a fine job in his descriptions. (He's better with silver dollars than copper, but that is only my assessment.) In any case he charges a reasonable 15% buyer's fee, ships inexpensively and is a seasoned numismatist. 

    In his current auction, he is selling a collection of Lincoln Wheat cents from an older collector. He is providing fine photos, as the 1931-D Cent above illustrates.

    Before bidding, I study his photos and descriptions, add my own analysis, look up the latest auction prices, factor in fees and place a low-ball bid (because anyone who bids on raw coins takes a risk). Also, this seller submits to PCGS, and if a coin is uncertified, he felt it was generally not worth the effort. (That's a tip, by the way--to be explained in a future post.)

    Nonetheless, Lincoln cents in almost uncirculated and uncirculated condition can be worth winning, especially semi key dates such as 1924-D (2,520,000 mintage) or 1931-D (4,480,000).

    Before placing bids, I keep a running journal with what the trusted auctioneer stated, my assessment of the grade, and potential value. Then I decide to bid or pass.

    Here's an excerpt from my journal:

    AUCTIONEER: 1909 cent. Near-gem to gem red unc. 

    BUGEJA: Red-brown, MS64

    VALUE: $48

    DECISION: No bid; not worth the effort

    *  *  *

    AUCTIONEER: 1909 VDB cent. A little dark over the profile,but we're calling this a near-gem unc.

    BUGEJA: Red-brown, low mint state, questionable color, carbon spot

    VALUE: $20

    DECISION: No bid

    *  *  *

    AUCTIONEER: 1910-S cent. AU, very near unc

    BUGEJA: Carbon spot, cheek AU53

    VALUE: $60

    DECISION: $11

    * * *

    I know this seems tedious, but it is the only safe way to bid online. Don't worry about losing coins or get lured into a bidding war. There are thousands of coins in online auction. Bid well, and you'll have the funds to win other lots without disappointment.

    Informed Buyers Do Research Before Bidding

    July 14, 2016 10:06 PM by Michael Bugeja
    Auctioneers have every right to set opening bids, buyer's fees and shipping costs, and if they set them high, they could lose regular customers ... or score retail prices from bidders who win lots without doing research.

    Expand the screenshot above and read the PCGS certification on the label of this Iowa Commemorative Half Dollar. 

    Note: Sometimes auctioneers put stickers there so you will not be able to check registrations. (Here is an irksome example of that on Proxibid.) If you really want the coin, call up the auctioneer and ask him to read you the certification. 

    You want to check certs rather than price lists because PCGS provides another link to CoinFacts (free now), which will tell you whether the coin sold in a previous auction. You'll also have access to more data.

    In this case, you begin your research by verifying the certification number on the label using PCGS's link for that . When you input the cert, you learn this 1946 Iowa Commemorative Half Dollar retails for $120 at MS64. To the right of that webpage is another link to CoinFacts  with recent auction prices. According to its data, this coin sells in auctions between $75-86.

    So if you place a minimum bid of $100--and nobody else places a bid--you will be "winning" the coin at retail, or what a coin shop would charge you. That's because the buyer's fee in this auction is 20%. Moreover, you would have to pay shipping and handling fees for this coin, increasing the price even more.

    Other top holdering companies, such as NGC, also verify certification on the label with current auction prices. Here is an NGC MS64 Iowa Commemorative valued at $130 by NGC. This coin sold on GreatCollections for $57.09 (or $62.80 with BP). 

    All these links are part of research. If you bid for coins online, you're doing so in competition with buyers like me who seldom place a retail bid unless I believe the coin is under-graded. If you don't take your time doing these steps, you'll quickly run out of hobbyist dollars. Never feel bad about underbidding if you have researched a coin. You actually won in many cases ... holding on to your own money. 

    Next time we will go through research steps with raw coins. Stay tuned.

    Cherrypicking the 1901 Morgan Double Die Reverse

    July 10, 2016 1:29 PM by Michael Bugeja
    During the past several years I have been able to identify in a few online auctions one of the rarest Morgan silver dollar varieties, or 1901 Doubled Die Reverse (DDR), also known as the VAM-3 Shifted Eagle.

    VAM is an acronym for Leroy Van Allen and A. George Mallis, numismatists who cataloged varieties in their Comprehensive Catalog and Encyclopedia of Morgan and Peace Dollars.

    The 1901 Morgan variety is considered one of the strongest double dies in the silver dollar series. A  misalignment of hub and die shifted the eagle and doubled the lower eagle wings, tail feathers, arrow shafts and arrowheads. As in the photo above (click to expand) you can see the dramatic doubling of the tail feathers--just as strong as the more popular and common 1878 Morgan 7 over 8 Tail Feathers.

    I first wrote about the 1901 DDR in a Home Hobbyist column . I won such a coin in a John Leonard auction with a bid of $240. He identified the variety in his Proxibid description. PCGS slabbed the coin EF40, worth $1,600. 

    On April 22, I spotted another 1901 DDR in an online Auction by Wallace session and won it with a bid of $275. It just graded EF45, worth $1,700. You can check the PCGS certification by clicking here.

    This is yet another example of how numismatic knowledge empowers bidders in online auctions. The 1901 Morgan in lower grades is fairly common. Not so the Shifted Eagle reverse. The 1901 DDR that just graded was not listed as such in the Wallace auction description. I knew it, and that gave an edge over other bidders.

    You can do the same now.

    Questionable Lot Was Dipped

    July 3, 2016 7:46 AM by Michael Bugeja
    Last week I wrote about the ability online to distinguish between polished, deep mirror, and questionable lots, promising to follow up when I received the questionable coin to see whether might slab or whether it was dipped to the point of being cleaned and ungradeworthy.

    I won the 1883-CC Morgan dollar with a bid of $160, or a realized price of $192, with 20% buyer's premium.

    The coin was cleaned and dipped, ungradeworthy, with a value of about $140. So I lost about $50.

    But not all was lost. I now have a comparison photo (click and expand the one above) to gauge the luster of any future lots from this seller. You can see from the dual photo above how lighting can make a dipped coin look uncirculated (left photo) and how natural light can show the flaws (right photo).

    If you think the disparity is so great that these cannot be the same coin, look at the minor scrape on the obverse under the "M" in "Unum."

    The example shows how photography online can fool an experienced buyer.

    I also will bid much more judiciously on raw coins from this seller. I have purchased dozens of coins from him when his buyer's premium was 15%. Like too many others on Proxibid, he is charging 20% now, and I expect more from auctions that do this, especially in the descriptions. If a coin is tampered with, just say it. Some auctioneers can't tell the difference between a lustrous silver coin and a dipped one. This dealer can and isn't doing that.

    In the end, this post affirms the lessons of my last one. If you are going to take a chance on a questionable coin, make sure it has some other value, in case the coin is dipped or cleaned. The Carson City mint mark saved me from a steeper loss. If the coin were an 1883-O Morgan, a common year, with a photo that made the condition seem MS65 or MS66--won with the same $160 bid at 20% BP--my loss would not be $50 but $170.