A Guide to Coin Grading (And How They Are Graded)
Understanding coin grading is crucial for any coin collector. This article will go into depth about how to grade coins and why coins are graded in the first place.
What Is Coin Grading?
Coin grading is the process of evaluating the physical condition of a coin. This is done by assigning a numerical value to a coin on the Sheldon scale between 1 and 70.
This visual comparison will help you see the difference between coins of different grades. Image: Silvercoins.com
The amount of wear on a coin's design is the main factor that determines a coin's condition, and therefore its grade. Coin designs become worn through contact and use as money. This causes the details of the major design elements to appear to fade away. It also removes the coin's original mint luster.
Aside from wear, the condition of the coin may also be affected by any distracting marks. This could be scratches, stains, or any other damage. In addition, any alterations to the surface of a coin such as cleaning, tooling, or "dipping" in a new layer of metal will also dramatically detract from its overall condition.
Always remember that in numismatics (coin collecting), cleaning or otherwise manipulating the surface of a coin is considered a cardinal sin.
Coin Grading Scale Explained
| Grade | Abbreviation | Numerical Range | Description |
|---|---|---|---|
| Mint State | MS | 60–70 | Coin shows little to no signs of wear; an uncirculated coin. |
| About Uncirculated | AU | 50–58 | Coin shows only slight wear and has full details. |
| Extremely Fine | EF or XF | 40–45 | Coin shows minor wear on highest points of design and has complete details. |
| Very Fine | VF | 20–35 | Coin shows moderate wear and has nearly complete details. |
| Fine | F | 12–15 | Coin design shows considerable signs of wear but letters and numbers are clear. |
| Very Good | VG | 8–10 | Coin shows softness and considerable wear throughout the design. |
| Good | G | 4–6 | Coin shows considerable softness, even on design details along the rim. |
| About Good | AG | 3 | Some of the coin's design is completely worn away. |
| Fair | FR | 2 | Much of the coin's design is completely worn away. |
| Poor | PO | 1 | Most of the coin's design is flat and barely visible, but can still be identified. |
Also note: within the Mint State grades (MS60 to MS70), some platforms will also use adjectival grades to describe the condition of these coins.
You can read more about the history of coin grading by following the link to an excellent article from Hubert Walker and Charles Morgan of CoinWeek.
How Are Coins Graded?
Numismatic experts working at coin grading companies will view a coin under 5x magnification. This serves several purposes. It allows the grader to accurately evaluate the amount of wear on the coin's design, as well as determine that it is authentic. It also helps reveal if the coin has been "doctored" or manipulated by cleaning, dipping (also called "whizzing"), or tooling.
Under magnification, the flaws in a coin's condition can become much more apparent.
In most cases, multiple experts will evaluate a coin and assign it a numerical grade in their expert opinions. Then the final grade you receive will be an average of their individual grades. They will also attribute any special varieties to the coin that apply.
There are a few reasons that a third-party grading service might refuse to assign a grade to a coin, however. First and foremost, a coin will not be graded if it is deemed inauthentic—i.e. a counterfeit coin. Authentication is part of the grading company's job. A coin may be rejected for grading if it is badly damaged, as well.
How to Grade Coins Yourself
The blog SilverCoins.com makes the excellent observation: “Half science half art, the skill of grading coins can be learned with time and use.” With this in mind, you can learn how to grade coins yourself. In fact, it's important for you to do so if you want to be a successful collector.
Sure, you could exclusively buy coins that are already professionally graded. But if you want to be able to cherrypick raw (ungraded) coins, you will need a keen eye for grading coins yourself.
The best way to get an accurate sense for the grade of a coin is to use reference images. These are helpfully included in most coin collecting guides that focus on specific coin series, such as those published by Whitman Publishing. It can also be helpful to have some examples of a particular coin design in-hand.
With enough time and experience, you can become a skilled coin grader yourself. This will immensely improve your enjoyment of the coin collecting hobby.
Of course, the informal grading you do yourself is no replacement for professional third-party certification. The two leading coin grading companies are Numismatic Guaranty Corporation (NGC) and Professional Coin Grading Service (PCGS). They are the industry standard and provide a great deal of useful information about the coin grading system on their respective websites.
Example of a gold double eagle coin graded About Uncirculated 58 by NGC. Graded coins come sealed in protective plastic slabs.
Why Do We Grade Coins?
This is both a philosophical question and a practical matter. We'll break this into two parts:
- Why you should have an understanding of grading coins
- When (or in what circumstances) you should get a coin professionally graded
Understanding Coin Grading When Buying and Selling
Aside from overall rarity and the level of collector demand, the condition of a coin is the biggest determinant of its value. This is why grading matters and should be very important to any coin collector.
As a general rule, the better the grade of a coin is, the higher the value of the coin. So if you care about how much your coins are worth—as most collectors do!—then grading is essential.
Grading has a big impact on the buying and selling coins, unsurprisingly. Graded coins are typically more liquid, meaning they are easier to sell on the marketplace. The exact value of a graded coin (also called a certified coin) is also much easier to determine than a raw coin, although there may be some variation based on the coin's eye appeal.
When to Get a Coin Graded
The most important times to get a coin graded are:
- the coin is quite rare
- the coin appears to be in excellent condition
- the coin might be a valuable variety or error coin
- you want to be certain the coin is authentic
If any of those conditions are true, then getting a coin professionally graded is probably appropriate.
However, there are exceptions. You might not elect to get a coin certified if it's not particularly lucrative to do so. Such a situation might be a modern coin whose valuation doesn't increase by much in Mint State grades. A good example would be a common modern bullion coin such as an American Silver Eagle. Although grading may increase its resale value slightly, the fees for having the coin graded will outweigh any profit from a higher price.
Read more about the nuances of coin collecting and numismatics from the experts at Gainesville Coins:
Collector Resources for Understanding the Hobby of Collecting Coins
How to Collect Coins for Beginners: Coin Collecting 101
What Is an Uncirculated Coin? Guide to Condition and Value
What Is a Gem Coin? Understanding Quality, Rarity, and Value
What Is a Proof Coin? Definition and How to Identify Proofs
What Is a Brilliant Uncirculated Coin (BU Coin)? Beginner's Guide
Everett Millman
Everett has been the head content writer and market analyst at Gainesville Coins since 2013. He has a background in History and is deeply interested in how gold and silver have historically fit into the financial system.
In addition to blogging, Everett's work has been featured in Reuters, CNN Business, Bloomberg Radio, TD Ameritrade Network, CoinWeek, and has been referenced by the Washington Post.