What are Retail Prices?

Posted by Jeff Garrett on 1/20/2011

When NGC asked me to write a column on coin pricing for their new price guide, my immediate reaction was “this should be easy.” After giving the project some thought, I realize how complex the subject is. As everyone knows, there are...

When NGC asked me to write a column on coin pricing for their new price guide, my immediate reaction was "this should be easy." After giving the project some thought, I realize how complex the subject is. As everyone knows, there are at least a dozen published price guides for rare coins. Some are done yearly, such as the Guide Book of United States Coins (Redbook), while others are done monthly, weekly or in real time. The goal of each is to report the most accurate reflection of the retail rare coin market. Even what constitutes "retail prices" can be a matter of debate, however. Many would argue that auction prices are retail, while others view these as dealer prices. Some in the numismatic community think retail prices should be about 5% above what dealers have paid; others believe a 35 to 40% market is more in line. My plan is to examine this issue in great detail so that when making a purchase and using the NGC Coin Price Guide, you will have a clear understanding of how the numismatic marketplace works.

The goal of the NGC Coin Price Guide is to provide the most accurate and up-to-date tools for collectors and dealers to establish current retail pricing for United States coinage. The NGC Coin Price Guide is just one element available on the NGC site for information. Others include the NGC Census , which shows the population of coins that have been certified, the NGC Coin Encyclopedia, NGC Registry information and the recently developed charting capabilities for each issue. With this wealth of information, rare coin collectors will now have the ability to research and make important buying decisions. An educated buyer will do much better in the long run than someone who makes rash, uninformed purchases. Paying too much can mean waiting years longer just to break even on a poorly executed buy. I encourage everyone to explore the new NGC Coin Price Guide and all of the other great research tools available at NGCcoin.com.

What is retail?

There is no short answer for this question. As mentioned above, some think auction prices are retail. This is not true in most cases. Rare coin dealers purchase a large percentage of coins at every auction held in the United States. You can be sure they are not buying the coins for their personal collections. On the opposite extreme, when two wealthy collectors engage in mortal combat for a prized registry coin, the hammer price is not the new retail price for this coin. Also, a coin that falls through the cracks, selling for well below catalogue levels, is not the new retail price. As will be examined in detail in later installments, not every coin in the same grade looks the same. If two NGC MS 65 1907 High Relief Double Eagles are sold in the same auction and one brings $42,500 and the other brings $48,000, which is the new retail price? Sometimes the price difference can be even greater. Auction prices are an indication of value — not a retail price. Price guide editors must use auction records for information, but other factors come into play as well.

Retail price can best be defined as the price a collector can expect to pay for a coin after conducting moderate research. An example would be generic United States gold coins. These are very common and with moderate research a buyer should expect to pay 5 to 10% above dealer wholesale price to acquire an example. Finding a very rare coin is another matter. It may take years to find and negotiate the purchase of an extremely rare coin. The dealer will probably ask for a market — up closer to 40% in this case. As a collector myself, I can testify that when you locate something you have been looking years for, price is sometimes secondary. These decisions are best made with as much information as possible. Everyone wants to pay the lowest price possible, but an educated buyer stands the best chance when acquiring rare coins. The new NGC Coin Price Guide offers collectors these tools. Do yourself a favor and explore everything NGCcoin.com has to offer. You will be glad you did!

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