What's the premium for slabbing inexpensive coins?

I have a quick question for the group. Let's suppose I was looking at buying a BU coin from the country of Petoria. And suppose that the typical raw coin advertised as "BU" was selling for $50 on Ebay. I might consider buying that coin and say "yeah, sure it's BU, buddy, I don't trust you".

If I then locate an NGC specimen slabbed MS62 or MS63, what should I expect to pay for that coin now that it's in a slab? (I understand some of the markup will be associated with the cost of slabbing it and a "peace of mind" premium).

Next, suppose that coin is $100 raw in BU. Is the premium the same?

I'm looking for ballpark estimates of the premium. Your best guess. I don't expect it to be perfect, but I'm just trying to gauge the value of buying an NGC slabbed coin, which would have a much lower chance of being a "slider".

Thanks for any opinions.

Steve

 

Log in or Sign up to hide this ad.

I think there are lots of variables. But probably in general the "peace of mind" premium goes up as values go up.

I'll throw out a thought of a $10 dollar premium on a $50 coin if certified.
Then again, I'd probably discount a raw coin on ebay, so I dunno.

Looking forward to the opinions on this question!

 

Unless I’m buying from a trusted source like a LCS I only buy slabbed just for piece of mind, and I always verify pricing against several sites for a gauge, past sold auctions, blue book, red book etc.
I never pay more than the averages.
Too many scams online to buy raw for me.
Doesn’t directly answer your question, other than research as best you can and typically there will be a premium for slabbed, I would‘my pay any premium for raw from unknown seller.
Gold and silver typically will have a premium no matter what no matter the seller.

 

Way to many variables for a general premium for world coins. The only thing you can really say generally is that the raw will almost always sell lower as at that point you're just trusting the sellers grading for any premium

 

I'm not sure why you would want to pay a premium for something slabbed that only costs tens of dollars raw. More important is to know the coins you are interested in and if appropriate pay a premium/discount to what any book says, whether in a slab or raw.

 

Depends on a ton of factors. Wonder why 69's have no premium? Its because everyone is hoping for 70's, so a 69 is really a reject. THey slab en masse and the profits from the 70's pay for everything, the 69's are sold off in bulk.

Actually, if you think about it, 69's should sell at a discount to raw. With a 69 you are guaranteed it will not be a 70, at least raw coins COULD be a 70. I have heard, though, of some sellers cracking out the 69's and putting them back in OGP to sell.

Point being, unless you know the prices of each grade, no way of knowing if grade X in a slab should be at a premium.

 

And even then, with no two coins being the same it would be silly to pay a premium for an ugly coin that's in a slab with a bigger number than something really attractive a point down, or in slab compared to not. There's no substitute for knowing the series, then you won't feel the need to rely on others.

 

I get what you’re saying, but in defense of slabs sometimes I purchase coins that I’m not expert in. And I really really hate when I buy a coin that I think is BU only to find out years after the fact that it is AU.

If you think about it, if the market charges, let’s say a $30 premium, On a $50 coin then I would pay $80 for that coin. But when I sell it I will also get $80 back for it. So I didn’t lose anything. If I bought it raw for $50 and sold it raw for $50 I also wouldn’t lose anything. One could argue that the only thing I’m really missing out on is the interest on the $30 premium over the time that I hold a coin...however we all know that as the coin goes up in value the premium increases so I’m not so sure that you might actually come out ahead on that premium if the coin increases in value.

So in summary, by paying the premium I get peace of mind, and I will likely get most of my premium and perhaps even access premium back when I sell it in the future if the coin goes up in value. To me it’s worth it.

All that being said, I don’t wanna overpay for that premium which is why I asked my original questions.

 

My advise is just learn how to grade, yourself. You are buying the coin, not a number encased in plastic.

 

Depending on lighting I can make a coin look different grades in photographs and I do most of my purchases online. I don’t want to be limited to coins that I can physically inspect myself. I don’t want to be the guy who is constantly returning coins from eBay sales and I don’t have time for that.

Secondly, it’s amazing how just the smallest interruption of luster in one spot can make the difference between a gem and AU58. And it becomes even more challenging when the coins might not be fully struck, but then again you need a full strike for a gem so that’s not the best example.

For what it’s worth I’m a fair grader. But I do find comfort in the fact that my wife and kids will easily be able to determine exactly what I have in my collection if something ever happens to me. And I really like the presentation of slabbed coins.

Are world collectors mostly anti-slab?

 

Not as much anymore. The slabbing has been growing a lot over the years and PCGS and NGC wouldn't have multiple world offices if there was no business. They're basically just having the fight US collectors had a couple decades ago and will eventually go much more slabbed as has been happening.

Even the British mint is selling slabbed coins now

 

Dude, completely wrong. The market will NOT pay you back $30 in grading fees. You take a $50 coin, spend $30 to slab it, and you have - a $50 coin in a slab. Unless you are talking about a condition rarity or something, run of the mill coins in slabs you are NOT adding value to. Remember, the game is stacked against you. The big players pay WAY less in slabbing fees.

For ancients, experienced collectors actually pay LESS for slabbed coins. Its a pain cracking out the cases to remove the slab, so I discount my bids to pay me for this work. Most ancient collectors break open any slabs someone wasted money on. Sure, HA sells lots of slabbed ancients. That is because they do not want the risk of grading the coins themselves, and sell mainly to non-ancient collectors. I have bought some items there at times, but again discount what I will pay to account for having to crack open slabs. With HA charging sales tax nationwide now, I never even look at ancients there.

Do I hate all slabs? Of course not. I tell people to buy their 1916d dimes in slabs, as well as many other faked coins if you are not a true expert in the series. I personally buy slabbed colonial currency since to me its harder to authenticate them and they were heavily copied and forged for a couple of centuries. I buy slabbed items I am not an expert in, especially when talking about 4 figures plus. The guarantee of authenticity is what is valuable to me with slabs, (which btw is not even valid on ancients slabbed).

 

Interesting. That could have an effect on the value of certain coins in certain grades. I'll have to ponder that to figure out what I might want to snatch up now while I still can.

For fun, I did a quick study of some prices on ebay. I looked up some Morgan Dollars that graded AU55 that were prices at either $100 or $200 and compared them to their raw counterparts.

In general, a slabbed AU55 morgan that sells for $100 goes for about $50 raw.

In general, a slabbed AU55 morgan that sells for $200 goes for about $150 raw.

This implies that if the value of the coin (in the slab) doubles, perhaps the "slabbing premium" doesn't increase. But on the other hand, at least it doesn't lose value. My gut tells me that it does increase at the higher grades. And I also suspect that slabbing becomes more important when you're dealing with MS coins since being wrong is so much more hurtful at higher dollar values.

Steve

 

Actually you misread what he said. He was referring to the market rate and yes all his points about airs were spot on as well as the ways you can sell.

Ancients are completely irrelevant. It's very hard to argue something should be certified when they don't even guarantee them to be genuine.

 

Yes, that the market likely values as being worth $90.

 

Ok, don't listen then. Continue to believe there is a "premium" for slabbed coins versus a coin in the same grade. I am not going to argue with you. Go ahead and take a $50 coin and slab it and see how much you can sell it for. Most slabbing fees are "sunk costs", which means unrecoverable, but you think what you like.

 

With the exception of coins that are so limited as to not be available, Show me a some reasonably collectible coins in a slab that I can’t buy for less raw and I’ll believe you.

I think you misunderstood me. I’m not going to have any coins graded. I’m going to buy them in the slab.

 

If we limit this to inexpensive coins (like the title), then -in most cases- there will be very little premium for slabbing unless you receive a high grade (like a top pop).

Take something like an Australian Kookaburra (or almost any modern world bullion). The raw coin and the MS 69 will often be available for about the same amount (maybe a few dollars more for the MS 69). The MS 70 will have a larger premium. If we take a circulation coin that is worth $1 (something you might find in a junk/misc bin at any coin store) and slab it, the premium will also not be significant. I've bought slabbed coins like that for $5-$20 (less than the cost of slabbing).

If you like the slabbed coin and can buy it already graded for very little premium, then there is little risk.

In general, take a look at sold listings (like on eBay) and see what the difference is for the coin you are considering.

 

For what it’s worth, I agree that if you’re buying something that was just minted you are paying for the plastic. Also agree a junk coin won’t have much premium. (But you have to admit it’s strange that it still could have $5 or $10 of premium anyway).

In my humble opinion if a raw coin is worth over...say...$75 and it has true numismatic value, if you buy it already slabbed you will get all that premium back when you sell.

I’m going to weigh in on my own question. In my humble opinion if a coin is worth $50 for all the premium for a slammed version of that coin is $20-$30. If the coin is worth close to $100 raw, the premium will be from $50-$75 depending on how difficult it is to find the coin in decent grade.

 

If a coin isn't worth $150-200 (what you can actually SELL it for, not a book price), then you are throwing money away by having it graded. Every bullion coin will probably grade 69 or 70 and it will only be worth scrap, regardless how many years you keep it. Do not pay money to have a common or seldom-collected coin graded. Use the money that you save by keeping it raw and use the money to buy more coins to advance your collection.