Coin Pricing. Coin enthusiasts use four different terms when referring to coin values. The Catalog Price is an inflated price published on web sites and in coin magazines and coin books. People who know about coins rarely pay the catalog price. Next there is the retail price. This is the price that collectors usually pay for coins they purchase from coin dealers, from eBay and other auction houses, and from other collectors. Finally, there is the wholesale bid. This is the amount coin dealers are willing to pay for coins they buy from collectors and from the general public. When someone asks "What is my coin worth?" they usually mean "What can I sell this coin for?" i.e., they are asking for wholesale bid. Face value is the value shown on the coin itself.
Rules of thumb. For most collectible coins, wholesale bid runs about one-half of catalog and retail runs between bid and catalog. For special coins, such as those with rare dates, in excellent condition, or with unusual appeal, bid values can approach catalog value. Problem coins with scratches, spots, stains, or having been cleaned or mounted in jewelry, are worth far less than coins without problems. Usually problem coins carry no numismatic value at all.
In the graphic above, CoinQuest's catalog value is represented by the blue horizontal line, and the purple $0 line represents no value at all. The green and orange bars represent the range of values collectors and dealers are willing to pay relative to the catalog value. When a collector buys a coin from a dealer or at auction, he or she usually pays a little below catalog value, as represented by the average coins annotation on the green bar. If a particular coin is especially appealing, a collector may be willing to pay *over* catalog price to add it to his or her collection. This is shown by the green bar extending above the blue catalog value line. On the dealer side, an average coin usually fetches one-half of catalog value. Only if a coin is very easy to sell will a dealer pay more.
Wear. Catalog values vary with the amount of wear on a coin. Professional numismatists and avid coin collectors use a detailed numeric grading scale that describes wear. Coin grading is one of the joys, and one of the headaches, of coin collecting. We do not use detailed grading at CoinQuest, but only describe wear with simple adjectives shown above. If you become a collector (we hope you do!), be sure to learn all you can about accurate coin grading. It will make or break your collecting experience.
Value varies with wear. Catalog value goes up as wear goes down, but not in every case. Damaged coins, for instance, are never worth more than their intrinsic value due to gold or silver content. If there is no gold or silver in a damaged coin, it is worth zero. In addition to value due to precious metal, collector demand adds value and pushes price higher proportional to rarity. The value due to collector demand increases as the coin becomes more and more rare.
Eye Appeal. Catalog values account for wear on a coin, but not for eye appeal or damage. Wear comes from circulation and is part of a normal coin's life. Eye appeal ranges from repulsive to attractive, as shown above.
Cleaning. One of the biggest problems with rare coins is cleaning. Well-meaning people often clean their coins with steel wool, silver polish, acid, or other similar desctructive processes. IF YOU ARE TEMPTED TO CLEAN YOUR COIN, DON'T DO IT. CLEANING RUINS VALUE. You can't fix eye appeal or damage by cleaning your coin.
Damage. Problems inflicted on a coin over and above wear are considered damage by coin collectors, and they render the coin's value almost to zero. Problems include scratches and stains, spots and discoloration, corrosion, mounting as jewelry, gouges, nicks, and similar phyiscal damage. Cleaning (see above) is considered damage by coin collectors.
Holders. Coins in circulation are loose or raw. When collectors find special coins, they usually place them in holders. Holders can be very simple or very elaborate, and a few typical styles are shown in our picture above. In general, coins in holders are worth more than loose coins because they have been singled out as valuable. Loose coins may be valuable as well, but holdered coins are probably worth more than face value, and possibly much more than face value.
Toning. Opinions are mixed for toned coins. Some collectors seek them out, others shun them. Toned coins have picked up impurities in the air and, over time, have become discolored. Most of the time the added color detracts from the coin's eye appeal. But sometimes toning can be quite attractive. Some adjectives used to describe toning are shown in our figure above.
Die Varieties and Minting Errors. It usually takes a strong magnifier to discern small variations in coins with die varieties. Minting errors, on the other hand, jump out and sock you in the eye. There is a small but energetic following of both types of abnormalities, so both types carry collector premiums over and above the normal coin value. To be valuable, die varieties and minting errors must be imparted to coins before they leave the mint. Abnormalities derived outside the mint are not valuable.