Sooner or later, condition comes into play when prices are set.
Here are some July 2013 auction prices for 1983 10 Yuan Proof Silver Panda coin: $403, $1,434, $1,755 and $3,712. Why the huge disparities in price? I once said to Nick Brown, the late President of Majestic Rarities, that when there are big surprises in auction prices, 90% of the time it’s due to condition. Nick laughed and shot back, “It’s more like 99% of the time!” The 1983 coins are perfect examples: the $404 coin was ungraded and impaired, the $1,434 coin was NGC-graded PF 67, the $1,755 coin was NGC-graded PF 68 and the $3,712 sale was an NGC PF 69.
In numismatics sooner or later condition comes into play whenever prices are set. At one time it was enough for collectors to know if a coin was circulated or uncirculated. Over time we have learned to distinguish between better and lesser strikes, brilliant and dull lusters and various imperfections. As Nick added, “I try to purchase coins that are high quality with great eye appeal. Having high quality coins with great eye appeal allows coins to sell themselves. I know I will pay a premium for a nice looking coin over the same coin that is not as nice looking.”
As the 1983 Silver Panda prices show, even minor differences in quality can lead to major differences in price. In almost all cases, the closer a coin is to its original state the more desirable it is. There is both beauty and history associated with original luster coins. I am reminded of this at every auction preview. With careful inspection it’s often possible to predict which coins will bring the highest prices. Whether graded or ungraded some coins just have an extra zing, or eye appeal, that makes them special.
Graded and encapsulated coins have become the global standard. If an expensive coin is not authenticated and graded, buyers wonder why not and often pay less for it – or maybe refuse to buy it at all. This same attitude is now widespread among modern Chinese coin collectors.
There are a couple of good reasons for this. The China Mint’s original packaging is either a soft plastic pouch or a plastic capsule, or both. No one I know can consistently and accurately evaluate coins through these barriers. This is especially true if the plastic has turned yellow or faded with time. Even the most experienced buyers can be surprised by what lies behind an original double seal, assuming the seal is even original. Plastic pouches are all too easy to alter and many substandard coins have been resealed to cover up their imperfections.
In the bad old days a coin’s “grade” often changed depending on if the owner was a buyer or seller. Buyers couldn’t even be certain that a coin was genuine! Nowadays, with independent companies like NGC grading and authenticating coins this issue has largely vanished. This has allowed the entire hobby to expand and thrive. So what’s the difference between a $403 coin and a $3,712? Condition, condition, condition!
Peter Anthony is an expert on Chinese modern coins with a particular focus on Panda coins. He as an analyst for the NGC Chinese Modern Coin Price Guide as well as a consultant on Chinese modern coins.