Have you ever heard of the word “Numismatics”? It may be a word many of us have heard but may not understand. Well, it’s time we clear that up. We’re here to help you have a better understanding of numismatics; the how, why and what .
First, the proper pronunciation is Numis (Noo-Miz)-Matics. It means the study or collection of currency; including coins, tokens, paper money, and related objects. Oddly enough, it dates back to earlier times when it was a much broader study of money and payment methods used to resolve debts and exchange for goods. Early money used by historic peoples was referred to as “Odd and Curious” but was, in fact, used in conjunction with barter. The early Kyrgyz people used horses as the principle currency unit and gave change in lambskins. Currently, the lambskins are suitable for numismatic study, but horses…. Not so much. Other objects used as units of trade for centuries were cowry shells, precious metals, cocoa beans and gems. In reality, when you look at those items today, they are still traded as currency; more commonly in the drug trade and jewelry markets but never the less, they are still traded.
“Numismatic Value” is the term used to refer to the excess monetary value placed on coins and currency by law. This is also referred to as the collector’s value. For instance, a Morgan Dollar has a value, by law, of one dollar, but can be worth thousands. If it is worth $1000 and the original face value placed on the coin is one dollar, then the “Numismatic” or Collector Value is $999.
With the study of Numismatics come many other disciplines you must learn to be successful if you plan on collecting raw materials. Raw, or ungraded, pieces refer to coins or currency that have not been graded by one of the top two grading companies in the world, either PCGS (Professional Coin Grading Service) or NGC (Numismatic Guarantee Corporation). You will need to be able to grade coins which means determining the condition of the coin using the Sheldon Grading Scale. This scale goes from 0-70 and is used by both of the aforementioned grading companies to grade and certify coins. You can view the grading standards here: http://www.pcgs.com/grades/. Learning to accurately grade coins can take a lifetime. Many would say that grading coins is an art. As we all know, it takes time to master any skill and with art, the beauty is in the eye of the beholder. Grading can be very subjective and each individual may look at the same coin through a different lens and grade them completely differently. This is where you must be willing to learn all facets of coin production to help with your grading skills. Familiarizing yourself with what die polish looks like and other things that may occur during the minting process is one of the first steps to take in becoming a successful grader.
With the condition of the coin being extremely important in a coin’s value, it is also crucial to be aware of which mint the coin was made at and what year it was minted. With this information, you will be able to pull what the total mintage of the particular coin was, which is a major factor in overall rarity. An example of this would be if you look at two separate 1909 VDB Wheat cents. The 1909 S VDB, which the “S” signifies the coin was minted in San Francisco, only had a total mintage of 484,000 coins. This coin in a grade of MS64 (Mint State 64) is currently worth almost $3000. But the 1909 VDB on the other hand, which without a mintmark means it was minted in Philadelphia, had a mintage of 27,995,000 thus making it worth roughly $90 in the same grade of MS64. This can be confusing for some, but it is a prime example of how one slight variance can completely alter the value of a numismatic coin. With everything being the same aside from the mintmark, this is case a where you have a huge difference in value. This is one of the largest draws to numismatics; it is truly a modern day treasure hunt that we can all be a part of. We all get change during our day-to-day lives. Get yourself a United States Redbook and you can check the values of your coins any time. That $16 investment in your knowledge with the purchase of that book can prove to make you a lot more money than your initial $16 investment.
The three main things to keep in mind when attempting to determine the numismatic value of a coin are, Year, Mintmark, and Grade. With the right combination of these three, you could have a fortune on your hands, or in your change jar for that matter. We discuss high end numismatics all the time, but what’s to say that you don’t have ten pennies in your old mason jar full of change that have a value of $5 a piece? I think any of us are all for turning $0.10 into $50. Numismatics can sound intimidating but trust us when we say, as soon as you make your first find or your first numismatic purchase, it pays for itself time and time again. You can have tremendous fun all while providing yourself a security net for your wealth and you will never want to turn back.
Numismatics is a huge topic, which takes lots of learning and here at Sahara Coins, we are here to help you become the educated collector. So feel free to come down or give us a call anytime to discuss the options you have and possibilities of starting a very strong Numismatic portfolio for yourself or your family for the future.