I don't understand

[Steve103]

Someone please answer this question. I see so many graded coins that are not worth half the amount of the grading fees and postage. Why sell a coin for a few dollars when the grading cost Is twice as much as the value of the coin and then spend five more dollars to gold shield it ? I don't get it. Second question. I look at graded coins from the four major grading companies and there can a huge difference in asking price on average between them with pcgs always fetching the highest price. Isn't a MS 67 a MS 67 no matter which of the four major companies grade it. Are people just buying the holder or is pgcs so much better for some reason? Thanks

[Earle42]

You have, thankfully, discovered something more people should know before ever using the grading companies.

The reason there are so many coins not worth the cost of grading that has been slabbed is due to one word...MARKETING.

The following will be long, but is well worth your reading for understanding what grading companies actually are:

An insider's guide to grading companies:

Give a man a fish, feed him for a day. Teach a man to fish, feed him for life. Here is some beginners fishing tackle. Its worth your time to read.

Thinking of Slabbing? Make sure you understand the Facts...or You Could Lose Money.


Popular mistaken mindset:
1. The grading companies are not a way that the majority of people, even those with a great deal of experience who know what they are doing, are going to be able to use in order to make huge personal profits. Many people start using grading companies thinking they will find a way to finance their hobby, but they learn a hard lesson quickly.

Professional predicting not possible:
2. Watch some of Daniel's videos where he gets slabbed coins back from the grading companies. Note even people who live, eat, breath, and deal coins for a living (like Daniel) can accurately predict what grade the companies will give. And...the "fault" (not really a fault) is in a widespread mistaken perception people get from being exposed to all the slabs being sold nowadays:

a. Coin grading companies are a business out to make a profit - this is why they exist. They use a system where allegedly three, but in reality its normally two, graders look at each coin and give an opinion. The company videos showing the process make you believe this is a relaxed and paced process of studying each coin. In fact one PCGS video shows a number of guys sitting around a table discussing what they think a specific coin should be graded as (on youtube somewhere - sorry no link). Uh uh.

b. If you take a PCGS graded coin slabbed as MS64, break it out, and resubmit it to PCGS, you are never guaranteed the same grade again. The slabbed coin might come back MS62 (extreme and a bad day for graders), 63, 64, 65, 66 (extreme and a great day for you!). This is b/c the process is all subjective: No scientific/verifiable standards or methods are used. This subjectivity makes for greater company profits since people resubmit the same coin trying to get a higher (better price when selling) grade. In the 90s the companies, at great expense, created better (their own words) scientific methods not relying upon human opinion. No doubt the large profit from the re-slabbing game fell. The companies abandoned the science and went back to their less accurate systems.

But..this is all hearsay without proof. So...
Grading the Coin Graders

Here is another good read from someone there at the start of the grading companies:
Hobby negative impacts from slabbing companies

Error on errors:
3. People also seem to think grading companies will examine a coin to see if they can find an error and then slab it as such. But again, they ONLY GRADE coins. The companies will NOT try to find and ID an error for you. You must FIRST ID the error yourself, CHECK to see if the company you want to use recognizes that specific error, PAY them to verify the error on the label, and then you may or may not actually get what you pay for! The companies have a bad reputation for attributing errors incorrectly.

Link to and read (download if you want it) the pdf link in my signature as an eye opening example. Sadly, the verifiable data presented from the PCGS website shows trusting people have spent thousands of dollars on many slabbed coins that are not what the companies claims/slabbed the coins to be.

Cost concerns:
4. B/c people do not understand the businesses, so very many people end up with spending far more money to slab a coin than the coin is worth. The companies profit greatly with membership fees, submission fees, insurance fees, shipping fees and extra (chosen) fees. ANACs does not have all these fees though.


You don't have to throw in the towel over these companies...but education about the reality of them will put you on the right pathway to dealing with them in a legit way without losing money in the process.


And…if you just like to collect slabbed coins for what they are, which makes losing/making money from slabs irrelevant, then of course enjoy them!"

Are people just buying the holder or is PCGS so much better for some reason? Thanks

PCGS has a better marketing department that has made them the name most people first see. If you do take the time to read the essay I have in my signature, you will find an eye opening read showing repeated incompetence on a rookie level at "The best company."

MARKETING is what started these companies and marketing is what has made them so much money over the years.

In the essay I show how the companies once did use a verifiable standard for grading coins, but they abandoned it - likely b/c it cut profits.

So why do dealers use slabbing? B/c there are legitimate buyers out there who understand the above and enjoy their coins in slabs. So these people buy slabbed coins - but know to buy the coin and not the slab.

What I appreciate about Daniel is that when he gets a slabbed coin back that he disagrees with, if he thinks the coin is actually better than the company said, he will not hike the price up, but sell it as the company called it while telling the buyer he thinks its better. If the coin is worse than what the slab says, he will let you know he does not not think it deserves this grade, but won't crack it out and sell it raw at a higher price (like some dealers do).

[overkilltom]

I can help with this one and i been wondering the same thing for like 10 years. The biggest reason is they dont know what there doing they just send in what ever they have sometimes even modern pocket change. Another big thing is there were very nice Bulk deals over the years like 20 coin for 200 dollars and 100 coin bulk deal on stuff like 100 of one coin like 100 morgens or 100 franklin proofs and end up being like 10 15 a slab. i dont think stuff like state quarters and susan baloney will ever be worth more then the cost of grading ether way. pcgs and ngc are the big grading company's anacs is great in my book and in the last 3 years has has gotten a way bigger and better name for its self. i dont know who the 4th gradeing people you were talking about but if its icg id stay say. (id rather buy a pci coin then icg)

[Earle42]

The problem with ALL of the grading companies is what is listed in the essay I posted. In a nutshell: there is no science and no way to verify what they do. They are totally unaccountable.

People pay them for a grade that can change if they resubmit the coin and yet say their coin is graded "right."

The companies abandoned their (expensive for them to develop) scientific standard and went back to (their own wording when promoting the computer system) inferior way of grading coins.

Unfortunately when the internet dawned, slabs started to show up on ebay, more people were exposed to them, and so more and more people swallowed it hook, line and sinker that these were THE experts. After all, look at the professional looking plastic!

As long as someone KNOWS coins and are aware of the actual nature of the companies, they can enjoy slabs without losing money - and I can understand this as well - they sure look nice! But the more I research these companies, the more and more the term "snake oil salesman" is rapidly becoming more applicable. You don't want to even get me started on the touted PCGS guarantee! Its terrible for everyone but them!

[Daniel]

Bulk submission my larger coins dealers, the fees are much less.

[DSCoins]

For the bulk program the minimum number of coins that can be sent in is 100. Your big box dealers GovMint, Modern Coin Mart, APMEX, just to name a couple send in a boatload to the TPGs. Even though the mint will not release the names of the privileged dealers, it is not hard to figure out who they may be. They have their coins up on their sites before Joe Public can even think about buying them. The only thing that the Mint has acknowledged is that these companies get to place their orders on 10% of the total mintage. So, if the Mint is only going to have a mintage of 250,000, and one (1) per household, before you can even try to purchase one, 25000 are already sold. They don't have to worry about the 1 per household #@%$# like we do.

[SensibleSal66]

I know why. One reason anyways. Greedy people who think they have the million-dollar coin and send in whatever they believe it something and it's really not.