Vol. XXVI, NO. 2
Why They Cost So Much
There are several reasons why common VAMs in
PCGS-attributed holders never seem to be cheap.
So you just cherrypicked a raw Top 100 Morgan VAM and it’s in really nice condition. Good for you!
But since it’s a common one, the question now becomes what should you do with it? More specifically, should you pay to have it certified? Unfortunately, the latest price increases announced by the Professional Coin Grading Service make the answer to this question more difficult than ever.
VAM collectors, especially those participating in the PCGS Registry Set program, know all too well that PCGS-attributed VAMs nearly always cost more than those in other holders – and sometimes by multiples of price. Part of the reason why may be free enterprise and what the market is willing to bear, but some of it is simply the costs involved in putting a coin into a PCGS holder.
Using the 1887 VAM 12 “Alligator Eye” seen here as an example, here’s what makes an ultra-common VAM quickly become a $100+ coin when it is sold.
A. Purchase price of the coin. Let’s say you got lucky and were able to buy your raw cherrypick as an MS63. Odds are the seller still wanted at least Grey Sheet Bid for it. Cost: $39
B. Postage to mail in the coin for grading. PCGS wants everything sent in by Registered Mail, but that’s not always how things happen. The last package with just one coin that we mailed (not to PCGS) cost $1.51 in 1st Class postage, and insurance ($200 value or less) was $2.15 more. Cost: $3.66
C. Economy grading fee. PCGS isn’t raising grading fees in 2009, which means cheapest service will still be $18 each. But it is raising the handling fee to $8 per order, regardless of how many coins are involved. Let’s pretend this order contains four coins, even though the postage example we just used was for one. Cost: $18 + $2
D. VAM attribution fee. PCGS started out charging $15 per coin and later increased it to $20. Starting January 1, 2009 it goes up again to $24. Ouch. Cost: $24
E. Return postage. PCGS returns coins to submitters via Registered mail, and the cost varies according to the number of coins in the order and the total insured value. Minimum charge, however, is $16. (PCGS has announced this will increase in 2009.) Cost: $16
Now let’s tally up the costs and see where we stand:
$39+$3.66+$20+$24+$16 = $102.66
Wow. Perhaps the easiest of all Top 100 VAMs has nonetheless managed to turn into a $100+ coin even before we try to make a profit or factor in what it will cost to sell. It’s not a pretty picture, is it?
That’s why any time we hear someone say, “But that’s a common coin, it’s not worth that much!” part of us genuinely agrees with them. But that agreement is conditional upon it being raw. Certified coins sell for more because there are costs involved to make them certified – and at PCGS they are highest of all.
We may not like it, but we grudgingly have to admit that this fact of life is just one of the costs of admission into playing the registry game at PCGS….and we do plan to continue playing.