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Coin Scarcity Versus Coin Grade
by Francis Dao
What makes a coin valuable? Is it the grade or the scarcity? This is a hot topic that's highly debatable. But I think there are many clear reasons why one is better then the other. There is a lot of strong evidence, viewpoints, and different angles that suggests that one is better then the other.
Some people say that the grade is more important then the scarcity of the coin. It's obvious that a lot of common coins can sell for thousands of dollars if they are in high grades. And it's also obvious that a lot of coins, even key dates, can be worth almost nothing if their grades are very low. Some key dates aren't worth much, even in high grades. Evidence also shows that a lot of collectors try to get the highest graded specimen that they can afford. When they buy a higher grade, they just trade in their lower graded coin. Many think that a coin's grade is more important because their population can be limited in high grades. This will give them the best of both worlds. A high graded coin that has a limited supply.
Others think that a coin's scarcity is more important then its' grade. They say that a scarce coin will always be worth something, regardless of grade. We see a lot of collectors targeting key dates instead of complete sets. Collectors that value scarcity say that scarce coins will always be scarce, regardless if it's in a high grade or a low grade. So their supply is always limited.
It's true that even a common coin can be worth thousands of dollars in a high grade. But a scarce coin in a high grade will be worth a lot more. And it is true that even a key date could be worth just a few dollars if it was in a low grade. But it would definitely be worth a lot more then a common date in a low grade. It is also true that a lot of common dates in high grades may have limited high grade populations. But this is largely due to the fact that collectors are not willing to grade common coins. But then again, all coins, common coins and key dates, all have low populations in high grades. So it's not just high graded common coins that have low populations.
I think that both sides present some very strong points. In the debate, both present very strong cases. It looks like one cannot do without the other. But, I think there's a clear winner in the debate. If I had to choose a winner, I would choose scarcity. Scarce coins will always be worth something regardless of grade. A lot of collectors only buy key dates because common coins are not worth buying. Scarce coins will always be scarce, even in low grades. Common coins could never be scarce in low grades. This is why they are called common coins in the first place. In some rare instances, one cannot do without the other. So your best bet is to buy scarce coins in low population grades. In my book, doing this would give you the best of both worlds. A scarce coin in a high grade.
About the Author
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