When collecting or investing in coins or any kind, the “grade” of the coin is extremely important to its value. Coins and bullion that are merely bought and sold on their purity and metallic value are not graded, as their value is only set by the purity and weight—not the condition.

Coin grading is essential to a collectible coin’s authenticity and worth. A valuable coin may be worth much less if it’s not officially graded. The grade of a coin sets the value based on a scale from lowest to highest quality.

How Coins are Graded

Grading a coin is much like an art. The scientific portion of grading a coin accounts for the purity and weight, but the artistic application comes from skill and recognition of the coin’s artwork, finish, and minting. A coin must be graded by a certified coin grader associated with an official organization such as the PCGS, Professional Coin Grading Service, or the NGC, Numismatic Guaranty Corporation.

Once the coin is graded and assigned a particular grade level, it is placed in a sealed, protective container, and the grading remains with the coin until the sealed packaging is opened. Packaging prevents oxidation and wear and tear. Once opened, the coin must be graded once again.

The Grading Scale

Coins minted in the United States are graded on a 70 point system that was established by Dr. William Shelby. A grading of 0 would indicate the lowest state—the item is a coin, but hardly recognizable. A grade of 70 is the highest grade level representing a perfectly minted coin with no evidence of circulation or imperfections.

Coins graded with at least a grade level of 60 normally represent uncirculated coins with no wear and having a perfect appearance. When it comes to purchasing graded coins, collectors and investors need to understand the specifications of coin grading to avoid coin dealers who may mark coins as graded at a higher level than the coin actually merits.

Alpha Grades

Coin grading includes a numerical scale and an alpha scale to determine the condition of a coin. Below are the designations for coin grading:

Fleur du Coin, FDC: These “proof” coins are prefect in every way and have no marks or blemishes. This rating only applies to proof coins.

Mint State, UNC: UNC graded coins include any uncirculated coin that has no signs of wear or damage to include imperfections.

Almost Uncirculated, AU: The AU graded coin has minor indications of wear and can include markings on the highest raised points of the coin’s design from light abrasion

Extremely Fine, XF or EF: XF or EF graded coins reveal some wear on the highest raised points of the coin’s design, but no major blemishes.

Very Fine, VF: A coin graded as VF has light to medium wear but, all design features remain sharp and well defined.

Fine, F: F graded coins will have some moderate to even heavy wear with the design remaining clear and bold.

Very Good, VG: This VG grade applies to well-worn coins; their design is clearly visible but, lacks details.

Good, G: G grade coins have heavy wear and the design and details may be faint.

About Good, AG: The AG grade indicates only an outlined design with the date and details worn smooth.

Fair: Fair grading designates a coin that can be recognized only as its type and value.

Basal State: A coin graded as Basal is merely a chunk of metal known once to be a coin.