Starting a Coin Collection Part 3
In the last 2 articles we discussed the basics on getting started with a coin collection. For those of you who have not had the opportunity to read these (and would like to) please visit a site I put together with many of the articles that have appeared here at www.montrealcoinexpert.com
The last and critical bit of information you need to get started is coin grading. Condition is what makes value with most coins. Beyond value, having a collection of pristine, wonderful looking pieces of medallic art with all of the original details, and shine, is much more pleasurable to look at than a group of worn down ugly slugs.
Why does condition contribute so much to the value? Consider that 100 years ago people used coins even more frequently than now in commerce. Since most coins were made out of valuable materials (gold, silver, copper) no one would ever throw away coins…so many old coins are still around in great quantity. Coin collecting as a hobby has existed ever since they were made (over 2500 years), but was usually just for rich people with too much time on their hands (kings, wealthy merchants, etc). After WWII (lets call it 1950+), coin collecting became popular in Canada. Before this very few people were serious collectors. So in the early 50s people went out and tried to find all the different dates of coins to fill their collections…and they discovered which years were rare, and removed these from circulation. Now if you were one of those folks back then, you could have easily found coins from the 1950s, 1940s, 1930s, 1920s, 1910s, and even Victorian coins in your change. The thing is, since the older coins would have been in circulation the longest these would be the most worn. So fast forward to 2011…and coins from the 1950s and 1960s are really easy to get in new condition (as they were saved by those collectors)..but since virtually no one saved the older ones in NEW condition they are scarce in such state. Consider for example a common year penny…1933. In used but nice undamaged condition it can be found in our 3 for a dollar bin at the store. In new red shiny perfect shape (like it was the day it was made) it is worth hundreds of dollars or more! This is because it is plentiful is used condition, but rare new. This same logic applies to almost all Canadian coins before 1940.
Before embarking on a collection, as mentioned in the previous articles, it is advantageous to have an idea of what your finished collection will look like. Collections where all the coins are eye appealing, and in similar condition are much nicer to look at and will probably give you more enjoyment. Also, from a budgeting point, it will help you plan how much your hobby will cost. Most importantly knowing what you want, will help you know what you do not want. In other words, if you are offered a piece you need but it is not up to your standards you can reject it and wait for a better one.
So, how do you learn to grade a coin? Experience, and looking at a lot of coins. There are companies that will certify that your coin is authentic, and what grade category it would fit…but since grading is part science, and part art, opinions do differ. It is important that you look at a lot of coins, both in certified holders, and loose, to get an understanding of various grades. You can do this by looking at collections your friends have made, going to coin shops, attending coin club meetings, and attending auctions. Most importantly, only buy a coin you like, even if someone else says it is in nice condition…in the end it is your coin.