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Does the grading service you're using publish a
Population Report?

If not, why not?

At the time of this writing (late September, 2006), to the best of our knowledge only three grading services publish a population report: PCGS, NGC and ANACS.

A population report is a published report that the grading service produces periodically, showing the number of coins graded of each type, and the grades those coins received. These population reports are extremely useful for determining the rarity of coins ~ and here's a perfect example: As a result of the Pittman Act of 1918, over 270 MILLION silver dollars were melted down so that silver dollar production could resume in 1921, after having ended in 1904. However, the U.S. Mint didn't keep any records showing the dates of the coins melted. For that reason, some dates that we thought were very common because they originally had high mintages were actually much scarcer than we thought! By reviewing the population reports from PCGS, NGC and ANACS, we can see which dates have had relatively few coins graded compared to their original mintages, and thereby deduce which dates were most likely melted down in 1918 and in what approximate quantity. Since coin values are based in large part on rarity, these population reports are extremely helpful to the collector/investor looking to buy rare coins.

Could there be a "Dark Side" of coin grading?

I personally find it very hard to believe that a reputable grading service doesn't know how many coins they've graded or what grades they've assigned to those coins... so why would they choose to keep that information from their customers? A company that chooses to keep that information from its customers, or a company that doesn't keep track of what it's doing, isn't a company I would personally want certifying my coins -- but that's just my personal taste, and it certainly doesn't mean there's anything wrong with using such a company.

All coins are not created equal, and all coin grading services are not created equal. We all know that condition is everything when valuing coins, and coin grading is nothing more than a professional opinion. In some cases, money can be made by finding certified coins that are undergraded in their holders ~ coins that can be "cracked out" and resubmitted for a higher grade. There is also the possibility of coins being overgraded ~ usually by accident, we would like to believe, but human nature being what it is, is it possible that perhaps overgrading is sometimes intentional?

Since there can be, for some coins, a significant increase in value for a simple one point difference in grade (for example, from MS63 to MS64), naturally everyone wants their coins to receive the highest grade possible from the grading services because that can translate into more money. Many modern coins (US Silver Eagle and Gold Eagle bullion coins, Modern Commemorative issues, modern Uncirculated and Proof coins, etc.) are being certified and are coming back with grades like "MS69", "MS70", "Proof 69" or "Proof 70", often with the "Cameo" or "Deep Cameo" designation for Proof coins. The fact is that VERY FEW coins (relative to the total number certified) should merit the "MS70" or "PR70" grade (Mint State 70 and Proof 70 mean that the coin is, in the opinion of the grading service, absolutely FLAWLESS), and far fewer still should merit a "PR70 Deep Cameo" grade. The reason population reports are so important is this: If a company offers a lot of certified "MS70" or "PR70" coins for sale but the grading service that certified them does NOT produce a population report, BEWARE! Without a population report, how do we know that grading service doesn't label ALL (or nearly all) of its modern uncirculated and proof coins with that "flawless" grade ~ just to keep coins coming in the door to be certified? People want high grades on their coins, so how can we be sure that a grading service is grading coins accurately and not just giving everything a high grade so people will use that service? A population report is vital so we can be sure that the number of "high grade" ("MS70" or "PR70") coins being certified by that company is (1) a very small percentage of the total number of "like" coins they've certified -- at least if you're planning to pay a premium price because of the "70" rating!!, and (2) an accurate reflection of what the other grading services are seeing and certifying. If the grading service does produce a population report, we recommend that you review the "pop" information for the coin you're considering buying. If the "population" of the coin you're considering is pretty high (relative to the same coin one or two grades lower), then you probably shouldn't pay much of a premium for it. You should be able to obtain the latest version of a company's "Population Report" by calling that company and paying a modest fee to have one sent to you. It's an investment I think is very worthwhile!

Bottom line ==> If you're buying "certified" coins, we recommend that you only buy coins certified by a company that produces a population report, whose "pop" numbers are fairly well in line with the other services' population reports, and that you don't pay much of a premium for "very high grade" coins if the population numbers don't reflect that it's a relative rarity in that grade. We are certainly not suggesting that companies that don't produce a population report are doing anything wrong ~ we have no evidence that they are ~ but our slogan in this case is...

"Better safe than sorry!"

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