My Newbie Guide/Blog

So for whatever reason you've decided to collect coins, and ended up here. You've already done one thing right; this forum may not seem to be jumping with activity 24 hours a day, but there are certainly a lot of helpful members here willing to help and answer [even the most simple and silly] questions.

I got into the hobby a few weeks ago, having discovered some coins at the bottom of my old safe and decided to research them. For me, it clicked within days. I realised I wanted to be a collector. But I had lots of questions, so this blog will hopefully help some people looking to start.

1. Tools of the trade
2. Common Misconceptions
3. Coin Grading
4. Coin valuation
5. Where to find coins
6. Spotting counterfeits

1. Tools of the trade

There are some basic items you will need to start off. Nothing on this list is particularly expensive, but will help avoid common and expensive pitfalls later.

This website - In the catalogue section you will find almost every coin you will initially collect, and details on their composition, size, and weight, as well as the alignment of the coin and a picture.

Digital Scales - These will help weigh coins. Weight/Density is one of the most effective ways to quickly detect counterfeit coins, and for valuing your silver/gold coinage.

Calipers - These will verify that the size of the coin is correct compared to the expected size.

A loupe or digital microscope - This is not so vital right at the beginning, but will help you discern condition, mint marks, and counterfeits. It will certainly add pleasure to your hobby.

Coin holders (Paper) or Capsules (Plastic) - These will hold your treasured coins until you decide how you want to store them long term. An album will always damage coins eventually, so if you are looking towards valuable or excellent condition coinage, don't go for an album.

2. Common Misconceptions

A coin collection is a good investment and all coins value will rise with time. This is a myth, unless you are an expert at picking the correct coins and predicting future collector demand and shock conditions. Do it because you enjoy the hobby, not because you might have a nest egg in 20 years. If you want a nest egg, look to other options.

An uncirculated coin is always better than a circulated one. This will be covered later in grading, but you can get damned ugly uncirculated coins, and very nice circulated ones.

Gold and Silver coins will gain value faster. There is something in the theory that silver numismatics took a hit in the late 1980's when smelters were going full force, and the demand for coins dwindled until the mid 2000's which MAY mean that certain silver coinage is rarer than currently marketed and anticipated. However proper research has not been completed, and unless you know which silver coins are likely to come into higher demand, don't mess around with it. If you want to invest in gold, invest in late date federally minted bullion (maple leaf, krugerands, sovereigns) - Don't attempt to mix bullion investment and numismatic interest from the outset

A good feedback seller on eBay or a coin shop always sells genuine coins. This is untrue for a variety of reasons, and not always because the seller is being nefarious. Sometimes they are unaware themselves. Check every coin you receive to ensure it is genuine, especially if dealing in rarer or more valuable coinage.

Similarly, do not trust the 'grade' given on a website or in a shop. Make up your own mind. They have motivation to grade higher.

Coins should be cleaned from muck and grime. Do NOT clean your coins, it lowers value and does not increase it. Cleaning tools damage coins. If you are dealing in ancient coins (thousands of years old), they will often need cleaning but that is outside of my scope for now).

A rare coin is more more valuable. This will be covered later in valuations, but rarity does not determine value.

3. Coin Grading

Coin grading is an arcane art, complicated by the fact that different geographical regions use different systems. However you can think of 3 'tiers' of coin, with nicer looking ones grading higher for each type. The 'tiers' don't follow on from one another, the best of the 'lower' category tier may be far more desirable than one from a higher valuable tier. Age of the coin matters too; you would usually not expect a coin from 1400 to be graded in the same way as one from 1995. Always make up your own mind as opposed to relying on a dealers grade. Remember, decide how much you like the item before deciding whether to acquire it.

The first type is the 'circulated' type - This covers terms like VF (Very fine) EF (Extremely fine) and the associated numbers like VF30 and VF35 - The numbers are quite simple and an americanism, the higher the number, the better the coin in that tier. The grading goes like this.

Poor and Fair - These are coins you probably don't want. Their design will be mostly worn - In Europe you might find these coins described as 'Good'
Then in order, Good (G)
Fine (F)
Very Fine (VF)
Extra Fine (EF/XF)

In Europe, you will find an additional grade in this tier called AU or About Uncirculated. In the US, this forms an entirely separate tier of grading ranked AU50 to AU59.

Note that in Europe an AU coin will generally look nicer than a EF/XF coin, whilst in the US you may find a beautifully struck XF coin which is far more desirable than an AU50 coin (About uncirculated, but not very attractive)

The 3rd tier is for uncirculated coins, or mint state (MS) coins. Once more, in the US grading system, an AU58 coin will likely look far nicer than a MS60 coin. The US grading system ranks these coins from MS60-MS70. Europe generally just uses two grades for this, UNC for uncirculated, and FDC for 'fleur de coin'. An FDC coin in Europe would usually be about MS66 in the US.

To determine your coins simplistically, ask the following.

Is it uncirculated? If yes, go to the following question. If no, go to the next tiers questions.
Is it perfect? (no scuff or bag marks, no rim chips, no scratches under magnification)
If yes, it is a FDC in Europe, and a MS65-70 coin in the US.
If No, it is a Unc in Europe, and a MS60-64 coin in the US.

Is it pretty much uncirculated, but without some of the luster or with a few scratches? If no, go to next tiers questions.
If yes, your coin is a UNC/XF coin in Europe, and in the US it will be graded between AU50-59

If the coin is circulated, the better it is, the higher it will grade, but it will always remain in the circulated tier.

4. Coin Valuation

The old adage applies here, supply and demand. Four major things determine a value of your coin.

1. Base metal Value - This is the melt value of the precious metal in your coin
2. Availability - This is not the same as rarity. Availability determines how much opportunity you have to buy and sell a coin.
3. Condition - Would you want the coin in your shiny collection? Coins that look like crap are more often than not, worth little to nothing.
4. Numismatic Interest - This is intrinsically linked to availability, and determines the overall interest of the community in a coin. For example, people are interested in sets of coins, and the rare ones in the set will be worth more.

The first item is very easy to compute. Go to the numista catalogue, determine the amount of precious metal in your coin, and calculate it based on current gold/silver prices. Your coin can never be valued lower than it's melt value.

Availability is easier to determine in the modern age. Look on ebay. Is there 10000 examples of the coin you're trying to buy/sell? If there is, the value will be lower, but never be less than the melt value.

Are there a few items with lots of bids? Look at the condition of each coin, and compare it to yours. If it is in high demand, it will be worth more because there is less opportunity to acquire it, and people will pay more to not miss out.

Numismatic interest is the hardest factor to ascertain. News outlets and world events can seriously alter the value of coins. If the price of silver quadruples again, the smelting factories will go into full flow, and several silver coins will be lost. People are interested in the major sets from the major countries though, and the rare dates in big sets are often valuable. Of course, once a coin gets old, or if it looks better, there will be more interest in it. Additionally there will be extra interest in historically significant coins. If Putin decided to start a world war tomorrow, Russian coins of this period would be of extra interest in 100 years.

Nicely done, you are entirely on the right track. I love to watch new collectors bloom so I will very much enjoy reading your updates.

Uh oh, I think someone has been bitten by the bug. I'm sorry to say there is no cure.

Quote: "neilithic"​Uh oh, I think someone has been bitten by the bug. I'm sorry to say there is no cure.

​Marriage? Divorce for sure, trust me I know.

very nice... other useful tools I use:

1) a hand held magnifying glass ( x 4 magnification) for quick checking
2) a more complex magnifying glass ( x 10 magnification) with led light included and a scale for measuring inside - for slightly more detail but still easier than using the microscope
3) a magnet

I've got this double sided magnifier. It's got 10x on one side and 20x on the other side. It folds into itself and you can buy them pretty cheaply

Aren't sovereigns semi-numismatic?

One more section done, hardest one yet. This is taking longer than anticipated!

Quote: "pizzifini"​very nice... other useful tools I use:
​
​1) a hand held magnifying glass ( x 4 magnification) for quick checking
​2) a more complex magnifying glass ( x 10 magnification) with led light included and a scale for measuring inside - for slightly more detail but still easier than using the microscope
​3) a magnet

​
Hm, I should add at least one magnifying glass to the list as most people seem to use them

Thanks!

Quote: "neilithic"​Uh oh, I think someone has been bitten by the bug. I'm sorry to say there is no cure.

I blame you guys :)

Quote: "pnightingale"​

Quote: "neilithic"​Uh oh, I think someone has been bitten by the bug. I'm sorry to say there is no cure.

​​Marriage? Divorce for sure, trust me I know.

​This is why I stick to pets; they always come back when they need fed!

Just a few observations on the grading section if I may....

FDC should strictly speaking only be applied to a proof coin although in recent years it is used to indicate a high mint state coin which is somewhat redundant in my opinion. It's still far more common to find above average UNC coins described as Gem or inaccurately BU.

The term BU should probably be added. It should only be applied to full red uncirculated copper or bronze.

Having mentored countless budding collectors through the pangs of learning to grade coins I think the following should help -

Try to get a feel for what is the average condition for coins from each period. 1960 onwards EF+, 1920 - 1960 VF+, 1800 - 1920 F - VG, pre 1800 VG / G. Once you become familiar with this you have established a baseline against which you can mentally compare all your new coins. So when you are adding say a coin from 1950 to your collection you are basically looking for reason why it's not VF. Once people work out this simple trick it all just clicks into place.

P.S. I implore you for the sake of your sanity to abandon the Sheldon Scale and stick with the British style descriptive grading.

P.P.S. Neil, why does your loupe look suspiciously like a set of knuckledusters?

P.P.P.S. One of my exes recently sent me her phone bill, over ten years after I divorced her. Mainly due to her reckless spending :)

I came up with my own grading system that I use for coins in my collection. As I said on Phil's grading thread, I don't really care too much about grading I try to get coins that are VF or higher for my collection. My coins tend to have 4 grades

Both of these first two grades go in my "to be upgraded" file.

1. Poor - Any coin that would receive a grade of basal, poor, fair or good where the details are unclear
2. Heavily circulated - coins that most would grade as VG or F, where you can make out the details but the coins are unattractive

The other two grades are coins which I keep:

3. Lightly circulated - coins that would receive a grade of VF, XF or AU. The details are all clear and the coin is an attractive quality.
4 Uncirculated - self explanatory

Most of the time if you're selling coins you need to use the standard grades, but for your own collection I would encourage collectors not to get tied down to the official grading system simply because it's what everyone else uses, and go for a system that suits the way you collect. If you care about grades even less than me you could even go for a 2 grade system, "keepers" and "tossers"

Yep, that section definitely still needs some work! I'll work out a way to sort it once I've done this stupid essay

pnightingale, of course you may, critical feedback is the best kind :)

This may be worth putting into Numisdoc as a Beginners Guide. I also think it would be useful if links to it and the trading guide are sent out to new member as part of a welcome email?
It's been too long since I joined so I don't remember if such an email is sent out to new members.

Next section finally done :)

Keep the advice/comments/criticisms coming please so I know where I need to edit when I get round to editing.

Quote: "pnightingale"​P.P.P.S. One of my exes recently sent me her phone bill, over ten years after I divorced her. Mainly due to her reckless spending :)

​Phil, you're scaring me.

I am in the process of finalizing my 1st (22 1/2 years) and I had always hoped she would "at least" chip in $10 at some point....phone, cable, electricity, anything!!! Honestly, I am scared for her. Reality bites.