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Coin Grading – Meaning and ImportanceCoin grading, the process of evaluating a coin’s physical condition, and the assignment of an alphanumeric designation to describe that condition, is critical to the value of the coin in the marketplace.Although grade is by no means the only factor in a coin’s market value – scarcity, pedigree, historical context, and popularity are certainly influential as well – nevertheless, an authoritative statement that a coin conforms to a specified level of preservation and appearance will, more often than not, strongly influence a dealer’s or collector’s decision to bid upon or outright purchase the piece. Once a grade is assigned, especially by one of the top tier third party grading services, it will have a massive impact on the perceived value of a collectible coin. The subtle nuances of a coin’s strike, surface marks, color, and luster can produce a huge difference in the price asked for one coin over another of the same date and mint. This is especially true with a mint state (never circulated) coin. For example, as of this writing, the retail prices estimated for a relatively common 1889 US silver dollar from the Philadelphia mint, published on the pricing pages of a prominent third party grading service, are reported thus for each mint state grade: MS-62 = $ 38. MS-63 = $ 49. MS-64 = $ 72. MS-65 = $ 385. MS-66 = $ 1,600. MS-67 = $11,500. The prices are less important than the difference in the prices as the grade increases. Notice that the percentage of increase, grade to grade, itself increases… radically.
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