The 70 Point Sheldon Grading System

Discussion in 'Frequently Asked Questions' started by jody526, Jun 3, 2007.


    GDJMSP Numismatist Moderator

    I've explained it several times on the forum, but it's been a while. Long story short - born a Protestant and raised a Catholic.
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  3. Cringely

    Cringely Active Member

    As a quiz to ascertain why third party grading has value, look at the dollar coin (listed as VF by the dealer I purchased it from). The quiz part is for you to grade it and then tell me why or why not I should have sent it in for grading.

    Tomorrow (or Friday), I'll summarize the results and then give my reasons why grading (rather than accepting the "major buyers" may not be looking out for your best interests.

    Attached Files:

  4. davidwillson

    davidwillson New Member

    I could be wrong but I thought Sheldon created his scale only to determine the value of Large Cents and later - in the late '60s or early '70s - others adopted his scale to be used in grading.

    Read more:
  5. 1066merlin

    1066merlin ANA#R3157534

    There is some really great info in this thread for us rookies, thanks everybody!
  6. kaparthy

    kaparthy Supporter! Supporter

    70 Reasons Why the Market is Always Right

    Before you reply, read the original post.

    Unless DavidWillson is Hobo, there is an echo in here.
    True, and also addressed by GDJMSP who cited the year in which the Red Book appended numbers to the adjectives, 1977. However, I believe that the editors were only acknowledging the change, not making the trend.

    The problems are many and in a different online forum, I posted on "The Evil That Men Do" including Sheldon and Breen, and Frossard and the Chapmans, Thomas Elder and Farran Zerbe, and in that someone else dropped the name "Hall." Idols have feet of clay. That said, Walter Breen's flaws may or may not have much to do with his numismatic acumen. However, Sheldon's stealing coins from the ANS and others is not the problem. The problem is that the 70-point scale is to coins what Sheldon's somatotypes were to people: junk science; pseudo-science; quackery.

    A general adjectival description may be no better or worse. Buyer and seller need to trust each other. Absent that, numbers and words are irrelevant. ANA Grading and Brown & Dunn were joined by a PCGS book that is free online. "Three letters in LIBERTY" sounds like a standard, but that could be one for L half each for R and T and a lot of fractions for the others, all to make three. (Read the standards.) Nonetheless, for over 100 years from the mid-1800s to the 1970s, people bought and sold coins at a distance (via mail order) with overwhelmng success, many more commercial consumations than annulments. Thus, I have to disagree with Owle.
    I believe that everyone has the ability to make a judgment on a collectable coin, stock certificate, Hot Wheels, or barbed wire (yes, it is collectible), just as they do about picking which gas station to pull into.

    Myself, I think the 70-point scale is silly. Some people argue about 64 and 65 and 67 and 68 only because of the large dollar values that the better grades bring. No one cares if your Franklin Half is a VF-21. But we could. Same day, we may. In fact, it is easy to predict that we will, perhaps in the next generation. My thoughts and feeling about the silliness of the Sheldon scale will not change anyone's opinion. So, I accept it for what it is.
  7. Cringely

    Cringely Active Member

    Any grading scale (100 point, 70 point 5 star hotels, 3 star Michelin restaurants, etc.) is arbitrary. Hopefully, the scale represents some sort of relationship between the grade and the item being described. What Sheldon observed more than 60 years ago was a relationship between descriptive (adjectival) quality (grade) and price in large cents. Since the best condition (most expensive) large cents were selling for 70 times that of the worst condition, the grading scale became a 70 point scale.

    When Sheldon invented the 70 point scale, the relative price of a given large cent was linearly proportional to its numeric grade. Unfortunately, the linear relationship didn't last. As it turns out, there still is a mathematical relationship that relates pricing to grade. Rather than linear with numeric grade, it is exponential (constant percentage increase) per adjectival grade increase with the ten full adjectival grades being G (1st), VG (2nd), F (3rd), VF (4th), EF (5th), AU (6th), MS60 (7th), MS63 (8th), MS64 (9th) & MS65 (10th). For a given coin costing X dollars, the next higher grade should cost 1.75X dollars (assuming a 75% exponential relationship).

    Aha, you say that that is not true,and you trot out the Red Book showing a counter example where the relationship between grades is more that 2X or only 1.1X. My thesis is based on typical behavior of most coins (some will have larger increases, some will have smaller increases). On average, you will find that the relationship is (and has been) typically a 75% increase in price for every increase in adjectival grade. Details will be published in a forthcoming article “Price Trends of U.S. Coins” that I wrote for The American Journal of Numismatics and which will be published later this year.
  8. flathead62

    flathead62 Member

    good info,thanks
  9. Davobenz

    Davobenz Member

    Sheldon is still good for differentiating and grading coins with absolutely no wear, but with varying amounts of minor problems such as hairlines small nicks and scratches and problems with patination.
    There can be huge market value differences between a coin with absolutely no wear, and a coin which is absolutely perfect in every respect.

    Sheldon falls down badly when a coin that just barely makes MS60 and is valued at $60, and an absolutely perfect equivalent coin graded at MS70 is only valued at $70. Such a situation like that is impossible in current market conditions.

    These days, almost every collector of U.S. coins will accept Sheldon grades for MS60 through MS70, but will then value a coin in the MS60 to 70 range according to current market trends.
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