How do you price your raw coins?

[Kurtdog]

Restrict this to retail pricing. Restrict the market to collectors who know what they're doing. Close it out to those who require the theatrics.

 

You look to the price guides of the TPGs. As long as those purport to track the market, why not? You cap that off with the sales in the auctions. You figure something in the ballpark.

 

In other words, the same way, based on the same resources. Doesn't matter the coin is raw. You're just restricting your market, that's all. Were the coin in a slab, you'd have a much larger market.

 

That's about it, right? I'd think so. Correct me if you think that's wrong.

[wheat'swheats]

Your point?

wheat

[Kurtdog]

It's a question, wheat, not a point. Get it together.

[e1cnr]

Why would you want to limit your market to collectors that knew what they were doing? The ones that do not, generallly will pay much more - just look at the coin shows on television.

[James_OldeTowne]

Is this a question of "raw" vs. "certified"?? If so, then I just price raw coins exactly the same way as certified, except that in the case of generic cheap coins, non-certified coins get priced slightly less by comparison.

 

Extending that point, actually, non-certified generic inexpensive coins are "correctly" priced, while certified coins have the price of the slab added on, so I guess in that sense, the raw coins are more affordable. Of course, this is because some of the most ridiculous things I seen in slabs are coins worth only $30 or less that have no business being certified to begin with.

 

We also market raw and certified coins exactly the same way. In fact, they are all intermingled in the same inventory boxes. We are currently in the process of moving all our better raw inventory into DIY slabs so that they fit better with the certified coins.

 

You look to the price guides of the TPGs. As long as those purport to track the market, why not? You cap that off with the sales in the auctions. You figure something in the ballpark.

 

In other words, the same way, based on the same resources. Doesn't matter the coin is raw. You're just restricting your market, that's all. Were the coin in a slab, you'd have a much larger market.

 

That's about it, right? I'd think so. Correct me if you think that's wrong.

I do think that's wrong, on two points. First, we NEVER look at TPG price guides, which are an overall absurdity. Past selling level experience is BY FAR the best indication of market value, while the "greysheet" is our Bible. On esoteric coins, ACTUAL auction records help very much (which excludes eBay - it is not a legitimate auction setting in my opinion).

 

Second, what would make you think the market for slabbed coins is "much larger"? That is also far, far from reality. Non-certified coins outsell certified coins by a huge ratio.

[RWB]

They're all the same to me. The plastic holders are nice, but bulky.

[BillJones]

Restrict this to retail pricing. Restrict the market to collectors who know what they're doing. Close it out to those who require the theatrics.

 

You look to the price guides of the TPGs. As long as those purport to track the market, why not? You cap that off with the sales in the auctions. You figure something in the ballpark.

 

In other words, the same way, based on the same resources. Doesn't matter the coin is raw. You're just restricting your market, that's all. Were the coin in a slab, you'd have a much larger market.

 

That's about it, right? I'd think so. Correct me if you think that's wrong.

 

Like it or not PCGS and NGC grading provide a market advantage to coins that are certified. Even for those of us who know how to grade coins, we know that a certified coin is easier to sell and generally brings a higher price, and I hate to say this, but especially if it is a PCGS coin with a CAC sticker.

 

Let me put it this way. The most I ever paid for a coin was when I bought a 1796 No Stars quarter eagle at auction. When I was deciding what my maximum bid would be, and what my chances of getting the coin were at that price level, I considered several factors. Some of them were related to the coin itself, and others were related to certification factors.

 

The basics:

 

1. I liked the coin, and it fit in with the rest of my early gold collection.

 

2. The coin did not have any serious defects.

 

The facts:

 

I knew that I would have to pay more because the coin was certified. This is simply a fact of the market because certification established two things. First the coin is genuine (That is HUGE.). Second an expert as rendered a judgment as to the state of preservation that means something to many collectors.

 

The negatives (which helped place the piece within my financial constraints).

 

1. It was in a NCG, not a PCGS holder. Collectors pay more for coins in PCGS holders unfortunately.

 

2. It did not have a CAC sticker.

 

3. It had very light adjustment marks in the center of the obverse. These mint caused marks, which adjusted the weight of the planchet to the legal standard, can affect the value of the piece.

 

I was able to buy the coin. At the last ANA auction a 1796 No Stars quarter eagle brought $150,000 more than the piece I bought. It was in a PCGS MS-61 with a gold CAC sticker. My piece is in an NGC MS-62 holder with no CAC sticker.

 

I probably have not answered your assumption the way you wanted it answered, but the bottom line is if you want to get a fair price for your good, expensive coins, you need have them certified by either NGC or PCGS. Raw coins and coins in other brands of holders don't get the same considerations from both dealers and collectors. Raw and "third world" certification coins bring lower prices. That is just a fact of the current coin market.

[Kurtdog]

Wow, that's more detail than I thought I was bargaining for. I feel unjustly enriched. You guys really covered a lot for me, and I appreciate it. Let me just try and clarify a little, here.

 

I'm talking about transacting between members in various clubs. There's where that limited market comes in. Certainly these raw coins may very well end up in NGC slabs. These kids are into grading, though. By that, I mean, condition-grading. That's what turns them on. That is to say it would almost be inconceivable to these kids to collect coins and not know how to condition-grade them. They'd ask, "What's the point?" So, suffice it to say, they know what they're doing. Otherwise, they'd be investing in stocks or something.

 

Their market is limited because their coins are transacting among themselves. They're pricing them based on the same resources we'd customarily draw on to price slabbed coins, the rationale being, eventually every one of these coins could end up slabbed. I was wondering whether all of you price your raw coins in much the same way, basically. I think it seems like you do, pretty much. I got more than I was bargaining for in the question, too, and I'll gladly take it.

[coinman1794]

Restrict this to retail pricing. Restrict the market to collectors who know what they're doing. Close it out to those who require the theatrics.

 

You look to the price guides of the TPGs. As long as those purport to track the market, why not? You cap that off with the sales in the auctions. You figure something in the ballpark.

 

In other words, the same way, based on the same resources. Doesn't matter the coin is raw. You're just restricting your market, that's all. Were the coin in a slab, you'd have a much larger market.

 

That's about it, right? I'd think so. Correct me if you think that's wrong.

 

If you are restricting it to collectors, then that is a perfectly fine strategy. If you are asking dealers, however, they would go under quickly, as finding someone who understands coins enought to buy the pricier items raw, at market prices, won't sell enough coins to pay the bills.

[BillJones]

As a dealer I approached raw coins this way.

 

First I looked at what I could bet for the coin in the grade I thought the coin was. Then I reduced that amount by the gross margin (selling price - the cost of the coin) I felt I needed to get the make the a viable by. Then I reduced that number by the amount that I would have to pay for grading fees plus postage in both directions. The I took off a bit of a risk factor if the coin came back in al lower grade than I thought it would. If it came back in the "proper grade" I made a little more than I probably would have made had I bought the piece already certified. If I missed the grade, then I didn't do so well. The overal averages worked out in my favor.

 

The bottom line to collectors who have raw coins to sell is, chances are you will get more if your coins are certified because you reduce the risk and grading expenses for the dealer who is buying them.

[Kurtdog]

Now why would they ever want to do a thing like that, Bill, submit the coins? That takes all the fun out! But, I steer them to here, when they want it, and have been doing so for years. They get them all wrapped up, all nice and pretty, just the way that market wants them.

 

As far as our dealers go, yeah, just keep your eye on that all-important third line on that income statement. Provided it's reasonably-accurate and it leaves you with what you want in the end before taxes, you'll do OK. Heck, I've talked to dealers who don't know the difference between a margin and a markup. I don't know how they make money. How do you make money by accident?

 

PS: BTW, these margins work both ways, you know. You tell one of these kids a dealer's gross margin on sales, nine times out of ten, that coin is theirs, if they want it, trust me. In fact, I think their actual batting average might even be higher than that.

[e1cnr]

Most of my raw coins are not worth the cost of certification. For more recent stuff, the coin needs to be near top pop to justify expense.

 

Many dealers will keep coins raw until they get worth a certain point or very close to a big price jump grade wise. As an example the Morgan series - some issues are closely priced at MS 63,64,65 - while others jump by multiples.

 

 

So if you have a coin worth $10-20, what would the same coin in a slab be worth?

[Houston Investor]

If I believe a coin justifies the cost of certification I will send it in of course.

 

Otherwise I price raw coins based on their grade and market price. While certification makes a coin more easier to sell or get all the money its value is based on its grade. Consequently a PF 65 1963 Franklin is a $22 coin (assuming we use 2013 Red Book Value) whether raw, PCGS, NGC, ANACS, ICG, or whatever. I don't inflate or discount coins because of the holder or cave in to TPG politics when pricing coins. However, the reality of the market place (on coins more expensive than say $100) dictates that people prefer PCGS / NGC graded coins.

 

There are many coins worth $10-$20 (collector coins) and I price them the same irregardless of being slabbed or raw. I would not pay a slab fee to slab a $10-$20 coin. However, I will discount collector coins (browse or junk box) fairly liberally (like 10-20% off prices marked). A good show with strong sales of collector coins can pay your expenses.

 

I know of a dealer who primarily deals in this material and for uncs he will put Gem BU, Ch BU, just BU on the 2x2. He will then price the coins based on CW Values, pricing the Gem BU's at MS65 money, the CH BU's at 63-64 money, and the BU's at 60 money. In addition, he will assign a numerical grade on the back of the holder in code as a guide to any future repricing. He knows how to grade and looks at them under a glass. Some of these he will self slab (with the business name and his numerical grade) to allow them to mesh with the TPG coins in his case at shows.

 

I would suggest a consistent policy pricing coins whether slabbed or raw. Then later if you want to discount a coin because it is raw or in a 2nd tier TPG slab you can do so at that time. An inventory spreadsheet in the computer is ideal vs tons of stickers and all the work that goes with that. Then when prices rise or you need that extra coin to make the minimum slab submissioon this will identify slab candidates.