What is Coin Grading?

Developing a working knowledge in the art of coin grading is one of the first and foremost steps in becoming a learned numismatist and successful rare coin buyer.  Exactly what is coin grading, and why is this important?

Think of it this way: For the prospective collector to discount the criticality of grading is the same as a baseball player expecting to hit a home run without first learning how to hold a bat.  Both scenarios will most likely result in a strike out.

What is coin grading? As you will see, it is a critical skill in the world of coin collecting.
Coin grading is more art than science and requires time, study, and practice to master. While it may not be necessary to function at the level of a professional, learning the fundamentals of grading is a major step toward becoming a prosperous collector. Image by American Numismatic Association .

“Coin Grade” is an expression used to indicate the amount of wear-and-tear a coin has received over its lifetime.  A coin that circulated for many years likely displays heavy wear and deterioration, with much of its detail rubbed off from handling by thousands of people and other actions.

Opposite of that, a coin that never saw the light of day may be perfectly preserved in like-new condition, still possessing most of the same qualities it did as on the day it was minted.

Another way of thinking about it is that a coin's grade is a measure of how well its surface has been preserved.

Coin grading also may take into consideration the strike boldness, mint luster, surface reflectivity, eye appeal, and color of a coin (applicable to copper coins).

This 1794 silver dollar is thought to be the very first silver dollar produced by the United States. It's rareness and historical notoriety make it one of the most valuable coins in the world.
Speaking about a coin never seeing the light of day… this 1794 Flowing Hair silver dollar is thought to be the very first dollar minted by the United States.(1) The strike is sharp and the fields have proof-like surfaces, clues that it was an early die strike on a special blank. No other 1794 dollars have these qualities. From the moment of its creation, this dollar received tender care and today rates SP-66 on the grading scale (SP is for Specimen, alluding to its uniqueness). All 1794 dollars are rare, but the condition and historical notoriety of this coin make it extremely valuable, last selling in 2013 for $10 million.(2) Images by Stack's Bowers Galleries.

The grade is important because after rarity and demand, it is the most important factor determining the value of a coin. Generally speaking, the higher the grade of a coin, the greater its value.

Ken Bressett, former president of the American Numismatic Association (ANA) and “godfather” of the Redbook (a.k.a. “Guidebook of United States Coins”), had this to say about grading:

“Grading is really very simple.  All you need is four things: a good magnifying lens, a good light, a good memory, and 20 years of experience.”

Happily, even the novice coin collector, through diligent studying and practice, can develop enough skill and confidence to approximate the proper grade of most coins much sooner than 20 years.  While it takes talent and years of involvement to acquire the mastery of a professional, it's possible to become a semi-versed coin grader in the relative short term. 

The material that follows is not intended to be a substitute for a comprehensive training course in coin grading.  It does, however, dip a toe into the pool by covering the coin grading basics and why this topic is crucial to your goals as a rare coin “stakeholder.”  The ultimate objective here is to whet your appetite to learn more!

Use the links directly below to navigate the "What is Coin Grading?" section:

All the chapters referenced above are accessible from any other chapter in this section.  Thus, no need to return to this Introductory page to link to other chapters.

Coin grading can seem like a perplexing maze. It may seem that way, but there is plenty of friendly help available, so you too can find the path through the maze.
If you're new to coin grading, it may feel as if you're about to enter a perplexing maze (that's because you are!). Just remember, you don’t need to learn everything all at once. Becoming proficient at the basics is an attainable goal. From there, build upon that at your own pace. Unlike poor Algernon, you have plenty of friendly help available as you find the path through the maze. Image by Shutterstock.