What does it take to create, publish, and maintain a price guide for coins?
Readers who downloaded my first edition of the Coin Collectors Handbook: American Eagle Coins have asked about the lack of a price guide. I hesitated to add a price guide for American Eagle coins because, with very few exceptions, the spot price of metals affects the prices. Market watchers know that spot prices are volatile. Are there differences in prices that might make working on a price guide a good time investment?
To better understand pricing and price guides, I asked several dealers what they use for pricing guidance. Most of them said the Greysheet and what the coins were selling on eBay. A few larger dealers will start their eBay auctions at $1 and sell the coins regardless of the final bid. High-volume dealers say they are rarely disappointed with the results.
Smaller dealers will subscribe to a service that will automatically adjust the prices based on the spot price and the results of the eBay inventory. Depending on the service level these dealers have with the service, the price for coins can change every day.
The pricing service can query eBay for list prices, and the prices realized to come up with their formula.
In the past, I tried to ask the people who write the Greysheet how they come up with prices. The harsh rejection at that time prevented me from asking again. It was time to look at other guides to determine how they create their prices.
Information from PCGS’s website is clear that their price guides are for coins only in their holders. In the past, PCGS noted their price guides use the prices on the Certified Coin Exchange market, which Collector’s Universe, PCGS’s parent company, owns.
Similarly, NGC notes on its website that they base their prices on the market of NGC-graded coins only. Neither service considered the market perception of CAC-certified coins. Although the Greysheet has a publication that publishes guidance for CAC-certified coins, that information is available only to subscribers.
One of the price guides not affiliated with a grading service is Numismedia. They are similar to Greysheet in that they offer a range of publications that span the market. Although their website does not disclose how they determine prices, their Fair Market Value guide has been more comprehensive and closer to retail market values than I have experienced with the Greysheet’s retail guides.
Other price guides found around the web have different concerns. A few are crowd-sourced, meaning that collectors provide input based on what they paid. Although crowd-sourced prices report real-world transactions, the information is limited to what users report and not a market survey.
Then there is the Red Book, A Guild Book of United States Coins. For 75 years, it has been the bible of coin values for many collectors. Unfortunately, the Red Book has several problems. First, it is published once a year and released in April. It means that production for the Red Book must begin before then.
A few years ago, I volunteered to work as a pricing contributor for the Red Book. I felt prices for modern coins were too low for the market, and I tried to bring them up to reality. It was challenging to make the edits using the poorly design web form. Even with my effort, much of my input did not make the book. The following year’s pricing entry was a spreadsheet, but my attempts at aligning the prices with the market did not affect the published prices.
Another problem with the Red Book is that the contributors are not given sufficient time to provide input. The process should be ongoing rather than giving the pricing editors a few weeks to edit the prices, so there is no rush before closing the edition.
Although I was not involved with the Blue Book (Handbook of United States Coins) pricing, I suspect it has similar issues.
It appears that every method used to create a price guide is flawed. Publicly accessible price guides are too generic to be taken seriously. Unless the public is willing to pay high prices for the wholesale guides, there is an opaqueness in how the industry prices coins.
Creating price guides is a difficult task. Over the next few weeks, I will continue my market survey while compiling the price guide for the American Eagles Handbook. I will share what I find here on the blog. Stay tuned!