Not All Slabs Earn Respect of Market

By Harry Miller, Numismatic News November 17, 2011

This article was originally printed in Numismatic News.
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Over the last 30 years coin certification has had a tremendous effect on grading and most would suggest a very positive one. However, there are pitfalls. One very large one is the proliferation of copycat grading services. These are companies that often have names very similar to reputable well-known companies, but are off-shoots of telemarketers. The coins slabbed (certified) by these companies are usually slightly off quality and would not normally certify at a reputable service. Experienced numismatists generally avoid these slabs. Very experienced numismatists will examine these same items and locate an occasional bargain where a coin was undergraded or a variety was overlooked.

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The first reputable service was created by the American Numismatic Association and its product consisted of a photo certificate with an obverse grade and a reverse grade. Since the coin was not permanently sealed in a holder, there were immediate issues regarding handling and possible guarantees. So the slab was invented.

Today we have perhaps half a dozen reputable services and hundreds of flaky ones. The pitfall mentioned above is that those new to the hobby or those who just wish to put some hard assets away as insurance often get trapped with the second-rate slabs. The typical telemarketer will offer a coin in, say, an MS-66 holder at something under an MS-65 price, convincing the buyer that it is almost as good as the top brands and look at the price at less than half the going rate. Of course, it should probably be nearer to one-quarter the price.

The reputable services have also contributed to the dilemma by promoting ultra-high grade and first issue items under various titles. These are items made for unsuspecting collectors and unknowledgeable investors who are foolish enough to think that these are actual collectible rarities similar to vintage coins that are truly scarce. There is absolutely no comparison to a superb gem Morgan dollar and an MS-69 or MS-70 silver Eagle, or a modern commemorative coin. If you don’t agree with this, then go to a major show and see what you get offered for properly slabbed MS-69 silver Eagles. Now if you like silver Eagles, slabbed are a nice way to go, but don’t pay huge premiums for them. They are not rare. Yes, I know certain dates in MS-70 are, but will anyone care 10 or 20 years from now? Most people cannot tell the difference between an MS-69 and MS-70 or even an MS-68 for that matter.