How PCGS determines pricing for their price guide

I just got my PCGS newsletter, and there is an article about how they come up with the prices in their price guide. Thought some would find it interesting.

https://www.pcgs.com/news/keeping-the-pcgs-price-guide-updated

 

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Based on what I've seen for certain less common series (e.g. the 3CS business strikes 1863 ff), they pull it out of a cow patty.

 

Kind of the explanation I was hoping for and would expect. That being said, I do think their guide is high. But I do use it as reference on my phone. For more expensive coins (relative, but let's just say $1K+, for me anyway), I use HA auction archives and their index for pricing.

 

I rarely use the PCGS guide myself. Even though it has the links to auctions, I prefer to just jump on HA or GC (or even ebay) to get a better feel of a coin's value. I hope and pray I never pay PCGS Price Guide prices for any coin!

 

I have paid over PCGS price guide, but it's due to exceptional eye appeal and/or beautiful toning.

1885 O MS65 star by jpcienkus posted Jan 16, 2018 at 9:41 PM

 

Their price guide is a marketing guide. They're a little too fond of their plastic.

 

There are times it's justified, and that coin is definitely one of them.

 

Oh, I can imagine. But for me, I find it high vs actual sales on HA/GC/eBay etc. on average. I'm not a dealer, and don't have my finger on the pulse of the market for everything, so to me, it just seems high in most cases.

 

PCGS is a bunch of snobs who think their product is better than any other. Do you really think they would let some outside service regulate the information in their Price Guide?

Chris

 

“If a coin has exceptional toning, or is offered in an old "rattler" or green-label holder, the price realized is sometimes stronger than usual and we must take care not to simply raise our price to match that particular coin as it may not reflect the typical offering.“
Cool, they openly talk about gradeflation

 

All pricing guides are questionable. Some coins will sell at half what's shown and others will bring twice the price.

 

The operative word here is "guide". As others have said it's just one tool to use as a reference.

 

That's not just gradeflation, that's more toning and CAC.

It's a nice way of saying that all superficially similar Goods i e ms-63s of the same year and mint mark aren't actually interchangeable.

Which defeats one of the purposes behind TPG grading. Which was the hope that if there was a reliable third-party creating interchangeable Goods you would be able to sell them into IRAs and unlock huge demand.

Never happened.

There are plenty of dogs in old holders picked over a thousand times and will never upgrade.

But it's ultimately BS unless they actually examine every coin sold, how do you differentiate?

The only thing they can do is say that price is so much above or below our price that it must be because of something with the holder. And that's substituting the wisdom of the price guide compiler for the wisdom of the marketplace.

 

If you think PCGS price guide is high, then look ATS at NGC.

 

I like to use the Numismedia guide that displays graphs of prices over a period of years, just to see how prices are trending generally. Also,IMOH, its prices seem to reflect a more realistic world than PCGS prices.

 

I have to agree about the way they price they slabs but I am sticking to my way a coin is only worth what a person is willing to pay no matter what a book or news letter says

 

I think this is very true. I've been hearing around here that you buy the coin and not the slab, and this should also apply to coins not in a slab. But I also expect a seller will price a coin at least partly based on recent price guides, which means bargaining is necessary.

 

The sad commentary about these plastic price guides is that all it takes is one bidder to believe in them and that's what the plastic sells for, or close to it. Take ten bidders and only one believes the coin is worth what the plastic guide says it's worth, while the other nine believe it's worth much less. That one bidder is going to win that coin at or close to its price in the plastic guide, because he's ready, willing, and able to bid it at that price, while the others aren't.

 

It takes more than one bidder to drive up the price in no reserve auctions. If 9 feel it’s worth 50 and the 10th feels it’s worth 500 the 10th will win at the first bid above 50 and no where near his max