A “numismatic coin” generally refers to a coin that sells for a significant premium over spot and its face value, because they are mainly purchased by collectors. Below are some of the factors that go into determining a coin’s numismatic value.
Coin Condition
To collectors, the face of a coin is called the “obverse,” the back is called the “reverse,” and the sides are called the “edge.” The raised images on coins are called “devices,” while the smooth backgrounds are “fields.” Collectors will inspect every one of these surfaces for scratches and other signs of wear and tear. Uncirculated coins, those that have never been used, are most prized by collectors and can demand a hefty premium on older coins.
Older coins that are circulated may still be quite valuable. A general rule is: the better their condition, the more they’re worth. However, do not attempt to clean a collectible coin. Collectors prefer coins that display normal, natural color, and improper cleaning can strip the original finish from the surface and can turn a rare collectible into just another bullion coin.
Coin Grading
It takes a trained eye to correctly evaluate a coin’s condition. Grading services like the Professional Coin Grading Service (PCGS) and the Numismatic Guaranty Corporation (NGC) inspect coins, grade them, and seal them for their protection.
The grading system used by these certification companies is called the Sheldon Grading System and evaluates coins on a scale of 1 to 70. The higher the grade, the more valuable the coin. A coin graded as a 1 is almost impossible to recognize. A coin with a grade of 70 is visually flawless, even under 5x magnification.
In addition to a coin’s condition, a grading service will also consider the timing of its arrival from the Mint. Those received within the first 30 days of their issue may be certified as First Strike, Early Releases, or First Releases, adding another dimension of collectibility. There is even a special designation, First Day of Issue, which is given only to coins brought to NGC within a day of their initial release.
After the inspectors at PCGS and NGC finish inspecting a coin, they seal it in a hard plastic “slab” with a bar-coded certificate that attests to coin’s authenticity and condition. These graded coins are particularly valued by collectors.
Strike and Finish
Many Mints around the world will create limited edition coins specifically for collectors, that have special strikes and/ or finishes. While these often commemorate a specific historical event, person, or cultural icon, bullion coins traditionally minted with a business strike will sometimes receive special treatment.
Proof coins
Proof coins are struck using polished planchets and special dies that give the field a mirrored finish and the raised devices a slight frosting. This helps the intricacies of the design stand out and makes for a beautiful overall appearance. Additionally, proof coins are often struck multiple times, which brings sharp clarity to the design’s devices.
Reverse proof coins
Dies give the raised devices a mirrored finish and the fields are frosted. Generally speaking, there are fewer reverse proof coins made, so there’s an extra dimension of scarcity contributing to their value. Like proof coins, reverse proof coins are struck multiple times, resulting in sharper details.
Specimen coins
Specimen coins are minted with a variety of different methods, depending on the Mint and the desired appearance. It could be hot, particle filled vapor blasting a planchet before it is struck, or a vat of tiny steel beads that polish the planchet and remove any excess metal. The result is always the same – a soft, satin, matte appearance. Coins with this finish are often referred to as “vapor-blasted,” “burnished,” or “uncirculated.”
Colorized coins
Some coins have finishes that are applied after they are struck. This is true with colorized coins, which receive a colorful design. The Royal Canadian Mint is the king of colorized coins, and they actually have two methods of applying color. One is the same method that you can find on most colorized world coins, where it is applied through a print. The other method is colorized enamel, added to the surface of the coin.
High Relief coins
Most coins are designed for circulation and if the raised devices are too high, the coins will wear down more quickly and lose their image with use. However, high relief and ultra high relief coins are not meant for circulation and often have raised rims to protect the devices. Not only does this bring added dimension to the coin, but it usually brings particularly fine detail.
Antiqued coins
Antiqued coins are another example of a finish applied after the strike. Immediately after a coin is struck, it is dipped, brushed, or otherwise treated with chemicals or dies in order to give it an antiqued finish. This finish has really grown in popularity recently, particularly in combination with high relief.
Applying this Knowledge to Your Collection
Now, as you add items to your coin collection, you can browse with a better understanding of the elements that give a coin its numismatic premium. The most important factor to consider when shopping for your collection, however, is if that coin appeals to you! No factor can make a coin more valuable to you than your own desire.
