AJ W. asks: Why is there a difference between third-party grading services if they all use the same grading guidelines? Even the GREYSHEET defines a rating percent for each grading service, it almost sounds like the ground rules for 3rd party grading are not totally established. Thanks.
The “perception” of how strict a particular grading service is (at least that week) frequently bestows a higher or lower price for a specific coin in a specific grade.
There are no official ratings per se but not all grading services are created equal. Coins from the top-tier services regularly bring more than those graded by lesser-tier services. That differential is not necessarily always warranted.
The entire concept of third party grading is to create consistency, that is, all coins with the same date, mint mark and grade are identical and are priced the same. Collectors know this isn’t true and coins with character and eye appeal will be more desirable no matter what the grade on the holder reports.
Grading is an art not a science. That doesn’t stop the market from deciding that one service is more conservative than another, therefore making their graded coins more valuable. The opinions about the services change often, but overall and over time, the values in any specific grade average out to be fairly equal, with PCGS and NGC taking turns on who is on top.
A recent poll from the Coin Dealer Newsletter shows that the average price of certified coins varying only 4 points between NGC and PCGS and averaging ten points lower for ANACS relative to CDN bid. There may be little meaning in the above survey. Coins are never exactly the same and grading standards seem to slide up or down a bit over time. For example, the ANACS coin could be removed from its holder, sent to PCGS and come back the same grade. If the above survey is accurate the PCGS graded coin would now be worth about 10% more.
Grading is still very much subjective, and not only varies between different grading services but often within the same grading service. (ie., coins being resubmitted to the services for re-grades quite frequently come back a different grade – both lower and higher. Furthermore, there are low end, average and high-end (premium quality) coins in all grades and in holders from all the services.
There is serious doubt whether anyone can consistently tell the difference between one grade number among eleven mint state grades (I’ll admit I can’t). This is a fantastic advantage for the grading services as collectors and dealers knowing that the grade assigned is subjective will pay to submit the same coins over and over again until they get the grades they want or need.
Third party grading may survive because the current crop of U.S. collectors want guarantees that their coin is a specific grade. The only problem is that coins will decline in price as the grading services dilute each mint state grade. Eventually every collector will have to have his coins regraded in order to defend his investment. The only winners are the third party grading services.
There is no substitute for knowledge and experience. The coin you buy must stand on its own. If you are not up to telling the difference, and it does take time to become sensitized to small nuances of strike, luster and other qualities, please seek the advice of a trained numismatist before you spend your hard earned money. In the final analysis, you’re buying the coin, not the holder. And in that case, what you pay for any given coin is what really matters, regardless of the number on the holder.
The following (from the proverbial horse’s mouth) might be illuminating:
FROM NGC’s SITE FAQ:
How widely do grading opinions vary among experts?
Discrepancies in grading of 1-2 points in MS60 and PF60 and better coins are not uncommon. In circulated grades a variance of 1-2 grades (i.e. VF35, XF40, XF45) also would not be uncommon. Discrepancies depend largely on how well trained the examining experts are in the area that pertains to a particular coin.