Why You Should Buy Graded Coins

Coin certification is a relatively recent addition to the coin collector's arsenal. It can provide plenty of advantages over housing your coins in their original mint packaging. ModernCoinMart offers plenty of professionally graded coins, but what exactly are the advantages of buying graded coins?

Coin certification is a relatively recent addition to the coin collector’s arsenal. It can provide plenty of advantages over housing your coins in their original mint packaging. ModernCoinMart offers plenty of professionally graded coins, but what exactly are the advantages of buying graded coins?

Many collectors prefer to buy coins that have been officially certified, or “graded,” because it ensures authenticity, condition, and overall quality of a coin. Two big grading companies, the Numismatic Guaranty Corporation (NGC) and Professional Coin Grading Service (PCGS) are trusted within the industry. Learn why you should add more graded coins to your collection.

Third-party grading and certification have made an enormous impact on numismatics over the past 30 years. During the early years of professional coin grading, it was mostly older coins that were submitted for grading. Coin sellers were not using uniform grading standards prior to the establishment of grading companies, and it was important to help create a more level playing field between buyer and seller. That has changed, and today recent issues represent the largest segment of graded coins submitted every year.

There are numerous benefits to buying certified coins. If they are classic U.S. coins, classic world coins, or ancient coins, grading is especially important for the peace of mind that comes with having a professional coin grader determine that the coin is genuine. All coins graded by NGC and PCGS come with a guarantee that they are authentic.

In recent years, counterfeiting has become more prevalent; it seems as if today no area of coinage is immune from counterfeiters. Even reports of common bullion coins being identified as counterfeits have surfaced. While there has also been an issue with fake third-party holders, or “slabs,” the grading companies have always tried to stay ahead of the counterfeiters. New technologies, such as labels with holograms and other measures, have been created to ensure the authenticity of a slabbed coin.

Many older coins are cleaned to remove the oxidation that forms on the coin over a period of years. While this can be handled correctly, for example by the Numismatic Conservation Service (NCS) which specializes in restoring coins to their original beauty, many coins have been harshly cleaned or altered. Improper cleaning can often result in damaged surfaces with a washed-out appearance.

Mint errors, defects, or other abnormal effects may sometimes be present on a coin. While this can sometimes be very obvious, some instances of these effects may be very obscure. This is where grading companies can really come in useful.

Grading companies will always indicate (upon request in some cases) if any of the aforementioned effects are present on the coin’s label. While you may not be able to see the tiny struck-though error on your coin, or the slightly washed out appearance from improper cleaning, the experts at NGC or PCGS will. You can rest assured in the surface condition of your certified coins.

Buying and owning graded coins is especially important because the coins are much easier to sell. Certification provides confidence that allows you to put more trust in the product you are buying. Certified coins are easier to identify, and their grade is extremely apparent. Because of this, a buyer knows the exact quality and state of the coin that they are purchasing.

This is especially the case with older coins, which tend to be difficult to sell unless certified. Pre-1933 U.S. gold coins and very scarce old coins are almost always sold certified, so buying them that way may be essential if you decide to sell. For example, Classic U.S. Morgan Dollars and Peace Silver Dollars are typically traded in graded form.

Another benefit to buying graded coins is that the holders, which are sonically sealed, provide effective long-term storage for your coin. Though slabs alone can’t offer complete protection against the environment in which they are stored, when they are placed in a cool, dry place they are almost 100% protected! 

Modern coin collectors tend to have a personal preference on whether they buy either graded coins, or coins in their original Mint packaging. In my own case, I prefer to do both. I prefer collecting bullion issues in their original Mint packaging, while I prefer high grade, harder-to-find issues graded by NGC or PCGS.

Those who collect graded coins will also find that they offer a useful way to not only store and protect their acquisitions, but also to organize and display them. For example, many collector coins are issued in large boxes that are too big to store in most safety deposit boxes or home safes. If the coin is in a capsule, it can be removed from the box to save space, but then it is hard to enjoy and examine the coin. If the coins are graded and slabbed, however, they can be stored in specialized coin storage boxes designed to be compact, yet functional.

The importance of quality is a huge factor in why people prefer graded coins. Unlike ungraded coins, coins that go through the certification process are examined by numismatic experts and given accurate grades. With certified coins, you can always be certain of a coin’s condition. For many, this is extremely important. Whether a collector has the hope of purchasing a coin in its finest condition, or a simple desire to complete a set of coins in the same grade, this is important knowledge that is relevant to any collector.

Certification provides an additional service to the collector by allowing you to find out exactly what coin you have. Both NGC and PCGS have a vast database with information on every coin they grade. You can find specs on a particular coin, as well as how many coins have been assigned to certain grades. This is called a coin’s “population,” and it can greatly influence the value of coinage in the modern numismatic world. All you have to do is search on NGC’s or PCGS’s websites using your slabbed coin’s unique serial code, and you can find out this information for yourself. Both grading companies even have phone apps that allow you to do this extremely easily.

While modern U.S. coins are more often graded than modern world coins, the amount of world coins being certified is growing every day! The market for graded world issues has been fueled in part by online auction sales. The grading companies themselves have also increased the number of certified world coins by opening offices in other countries. Both PCGS and NGC allow submissions from these offices, allowing collectors around the world to submit coins for grading. In addition, U.S. dealers, like MCM, are selling more and more graded world coins as the demand for them increases.

After reviewing these points, the benefits of having your coins certified are clear. Certification provides collectors the assurance and peace of mind they need when purchasing new coins or reviewing their collection. While the process is fairly new, its quick rise to popularity and the trust shown towards NGC and PCGS is quite encouraging. If you have never collected graded coins before, consider purchasing one to see if it is something you would enjoy!

*To read about a collector of Libertad 1 oz. silver bullion coins whose collection includes the top-rated registry sets at NGC, see my article in the August issue of Coin World magazine, pages 116-118.

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