Slabbed coins: pros and cons

Slabbed coins – coins in a secure plastic holder with a designated grade by a third party professional authentication and grading agency – are slowly becoming more of a normality in the UK. It used to be a sign that a coin had been purchased in the United States where the large majority of coins have been slabbed since the 1980s.

1887-S Sovereign in MS62
1835 sixpence in MS64

Because the US grading system has more steps it creates a higher demand for top grades, especially in the Mint State designation, where all numbers between 60-70 are used. The highest denominated grade within any coin type can fetch spectacular prices in auction. Coins in Mint State are often worth slabbing as small differences in grade have a large impact on value. This is a shortcoming of most other grading systems as small differences are not well represented. Even using ‘almost’ or ‘good’ before a British grade allows for a fairly large price range. Auction houses nowadays slab coins in EF or higher to maximise the realised value and premiums.

Another benefit of graded coins is objectivity. This is important when buying online, especially when buying without knowing the standard or level of experience of the dealer or auctioneer. It has been an ongoing matter of discussion for the grading companies on what basis to assess a coin – on wear only or all-encompassing. The industry has gradually gone more towards an all-encompassing approach in the interest of the end buyer. On that basis PCGS will give a lower grade to a coin that has some bag marks in the obverse fields than if the same size marks would appear in the devices and thus be more hidden away. Always be wary of coins with the ‘Details’ designation as this is used for coins that show signs of problems such as cleaning, tooling, hairlines etc. These coins are generally not worth grading unless they are from China, Russia, Poland or other higher-risk countries.

Which grading company to use?
There are small differences in how the professional grading companies assess coins. NGC has been criticised for being slightly more slack with their standards and an NGC graded MS63 will often be graded MS62 by PCGS. This will be reflected in the price level so it’s not worth avoiding NGC for that reason. A better reason to choose a preferred grading company would be the look and feel of the slab. For instance, one of the main reasons I chose to become a PCGS authorised dealer is their slick and scratch free holder. Being transparent they make the coin stand out better which I think is what it is all about at the end of the day.