Gold coin grading is important to investors because it allows them to know the exact value of their coin collection. Armed with that knowledge, they’ll be better able to know when to buy more coins similar to those they already have and when it’s a good time to sell.
There are five factors evaluators of gold coins take into consideration when grading a coin, these factors are:
Strike: This is how the coin is stamped with a design on its surface. Coins can have either a weak strike or a strong one. Some issues of coins have uniformly weak or strong strikes, while others are mixed. Strike usually isn’t that much of a big deal when determining coin grade except when the value of that type of coin is related to the strike. For example, in Mercury Dimes, a weak strike is worth far less than a coin with a strong strike. Surface
Preservation: Surface preservation is perhaps the most important factor in coin grading.This relates to the number of dents and dings your coin has acquired over the years. Penalization for marks varies. For example, a coin that has a deep mark on the reverse side may not lose as much in coin grade as a coin with a small, but visible mark on a prominent part of the obverse side of the coin. Some coins tend to show marks more than others. As a rule, the less cluttered or “busy” the coin design is, the more likely it is to show marks.
Luster: This refers to the surface texture of the coin. The closer the coin is to the original surface texture of the coin, the more it will be worth. When examining a coin for luster, coin graders look to see how much of the original surface of the coin remains and how many marks the coins have and where the marks are located.
Coloration: Coloration is another key component of grading coins. It’s also very subjective, as individual graders may prefer different colors. Gold coins that show a deep green-gold coloration may appeal to one grader and be a non-starter for another. Gold coins do not have as much variance in coloration such as other types of metal coins like silver or copper, however there is some divergence in color among gold coins.
Eye appeal: This takes into account the “total package,” that is the combination of coloration, luster, strike and surface preservation. It may be that a good strike and good coloration can make up for some marks and weak luster on a coin, or that good coloration and good luster can’t make up for a poor strike.
Getting your coins graded by a professional grading service such as PCGS or NGC is a good way to get a true sounding of the value of your gold coin collection. Having a good working knowledge of your coins’ worth is another way you can secure your investment’s value.
