Question about Grey Sheet Bid/Ask price.

Hello. Tiny question here. I have been curious about the grey sheet bid/ask price sheet the dealers use. Best way to ask my question is to give an example which goes like this.

A coin you want has a bid price of $900 bucks and a ask price of $1,000, then would this mean this coin is available out there for the ask price of $1,000 to the dealer. I know there is a dealer mark but this coin is available and the dealer should be able to get it for you if they wanted to. Is this correct?

 

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In theory that is correct, but it is a supply and demand thing, if the deal can't move it he won't pay bid. I have a dealer that usually pays bid for my extras but some stuff he won't touch for that even for me. The bid/ask is a starting point, sometimes if the coin is needed, the dealer has a buyer waiting for it and can turn a quick smaller profit they will pay above ask.

 

Bama,

There are two CDN Price Guides that dealers can use. The Greysheet is routinely used for sight-seen transactions, and the Bluesheet is used for sight-unseen purchases.

Most dealers make sight-seen purchases somewhere back of Bid, and they hope they can sell it for somewhere close to retail which is usually above Ask, but they will often come down to somewhere between Bid and Ask and still make a profit.

If a customer is looking for a certain coin that their dealer doesn't have, the dealer may contact other dealers to locate one. In many cases, they will refer to the Bluesheet to determine a suitable price to pay the other dealer. Bluesheet prices are generally lower than Greysheet prices. This will enable "your" dealer to make the purchase from another dealer, and complete the transaction with you at a price that will still give him a profit.

I hope this makes sense.

Chris

 

Not quite. Think of greysheet more like recent sales history. Using your example, in the recent past the coin has wholesaled for about $900 and retailed for about $1000. That doesn't mean a dealer will be able to find you one.

Greysheet is available to anyone willing to pay, not just dealers.

 

You are correct. the greysheet is available to anyone, but they list coin dealer pricing - not retail pricing.

 

Bid - What a dealer is buying a coin for.

Ask - What a dealer is selling a a coin for.

The difference between them is the speard. That's the profit margin.

With graysheets, that's whole sale pricing, not retail as stated above. So, if you were going to sell your coins to a dealer, expect around bid prices on the gray sheets. If you wanted to buy a coin from a dealer, expect retail ask prices.

Also stated before and worth noting, the gray sheets are history. It comes down to supply and demand. If a Dealer knows he can say a coin higher then the price you're willing to pay, well, that's that. If the Dealer knows he can purcahse a coin lower then what you're offering, same princple.

That's how the market and Adam Smith's invisible fist works.

 

It was an analogy, not a financial lesson.

 

Was agreeing with you there se-collectiables. Graysheet pricing is a history, not the final end all be on on pricing.

 

For a lot of us dealers, we make most of our money via "wholesale" trades--selling to other dealers, usually face-to-face at shows or via established contacts. So depending on what is being offered--I'll use modern proof sets as an example--we pay 20%-30% "back of bid" and then sell them for 10%-20% back of bid to another dealer. This leaves them some room to sell to all those "retail" customers carrying around the Greysheet at shows hoping to buy everything at Bid or below.

 

I think of the greysheet as listing wholesale prices.
As a collector I don't expect to get items at those prices although sometimes it happens.
This is what dealers expect to pay for items.
But even at these prices dealers won't buy if they can't move the item in short order.
They don't make a profit if they don't sell the coin no matter how little they paid for it.

This is where the collector can often get a bargain.
The dealer makes a mistake in judgment and can't sell for a profit.
So to make the best of a poor situation they sell for no profit in order free up cash for items they CAN sell.
I think that was the case when I bought my 1862 $1 gold. Bought it at BID.

My other guide is Coin Values. I think of it as listing retail prices.
As a serious collector I look to pay less than CV prices.
It would be unusual for me to pay more but it sometimes happens, particularly when I think a coin is on the PQ end of the grade.

 

So what you're saying is, dealer to dealer, you're looking at buying 20 to 30% below bid, selling them to other dealers 10 to 20% below bid and then selling them to retail collectors at bid?

 

yeah pretty much is just like any business

the greysheet is a guide. and a guide only. if a coin is a key date, and it has terrific eye appeal, with a ngc or pcgs slab, you will get way over ask for it. but if its for instance a key date, no slab and some ugly toning ( brown and unatactive) it will sell for around bid to a little higher than bid.

just like any resource the greysheet is a guide, i deal in coins, but if i like the coin ill pay more.

just like if you like your waiter you are gonna tip more than the customary 15 percent.

 

Dealers rarely work at that small bid-ask spread.

 

My problem with Coin Values is that, in many cases, they seem to be significantly higher than the Redbook, even adjusting for publishing lags. Some extreme examples are the 1793 half cents and 1793 large cents.

 

Yeh, some of their listings are WAY out of whack.
That's when I'll look for a third source.

 

From my experiance you usually have to pay better then the bid
And sometimes over the ask to get what you want!