Improved Grading for AU Coins
Improved Grading for AU Coins
This article exposes a weakness with the About Uncirculated (AU) part of the 70 point grading scale and proposes a solution to improve it.
In the previous days of coin collecting there was a simple way to describe the condition of coins; a coin was either “new” or “used”. This situation was eventually improved when The American Numismatic Association (ANA) endorsed a system created by Dr. William Sheldon in 1949. Here it is in a nutshell:
There are fundamentally two types of coins; Circulated or Uncirculated. The Circulated coins range in grade from 1 to 58, and the uncirculated coins range in grade from 60 to 70. This article focuses on the About Uncirculated grade range from 50 to 59.
Grade Category Numeric Grade
Uncirculated 60 to 70
About Uncirculated 50 to 59
Extra Fine 40 to 49
Very Fine 20 to 39
Fine 12 to 19
Very Good 8 to 11
Good 4 to 7
About Good 3
The coins in the ‘Uncirculated’ category do not exhibit any wear, and range in grade from 60 to 70, with 60 representing a coin with many heavy marks and 70 representing a “perfect” coin with no marks.
The coins in the ‘About Uncirculated’ category have little wear, with AU58 exhibiting slight wear on the high points of the coin, AU55 with friction on less than half of the surface, AU53 with very slight flatness on the high points, and AU50 with slight flatness on high points and friction wear over most of the surface.
The coins in ‘Extra Fine’ category have more wear than the ‘About Uncirculated’ coins, ‘Very Fine’ has yet more wear, and so on down to ‘Poor’, which is a coin that is barely recognizable.
The AU Category Weakness
The use of the scale to gauge value works fine in the range from ‘Poor’ (1) to ‘Extra Fine’ (45), and also works in the Uncirculated range from 60 to 70. But the scale does not work very well for coins in the ‘About Uncirculated’ (AU) range of 50 to 58.
The fundamental problem with the AU range of the scale is that it does not consider the condition of the coin as is done in the MS range. For example, a coin grading AU58 could have superior mint luster, a great strike, and no visible marks while another coin grading the same AU58 could have little luster, a weak strike, and numerous marks. Obviously the first coin has a higher value than the second one. The problem is that the only thing that AU58 specifies is that the coin has very little wear.
In another example a coin with few marks, a strong strike, and great luster that grades AU50 can easily have more value than a coin that grades AU58 but has marks, an average strike, and no luster.
In reality the value of coins in the AU range also overlaps the value of coins in the MS range, and a nice AU coin can be worth more than a lower grade MS coin. This occurs when the AU coin has better eye appeal and less marks than the MS coin.
An Improved Method to Describe AU Coins
The AU part of the scale from 50 to 59 should reflect the characteristics in the MS part of the scale from 60 to 69. In other words, an AU50 coin should look a lot like an MS60 coin, except the AU50 coin will have slight wear where the MS60 coin does not. The AU51 coin should look a lot like an MS61 coin, except for slight wear, and so on up to an AU59 coin that would have a great strike, great luster, and no visible marks, but with slight wear.
This makes better use of the 10 points available in the AU category of the scale, as it provides a better description of the condition of the coins. This more precise grade can then be used to more accurately value coins in the AU range. This should result in some AU prices that exceed some MS prices, as is the case in practice.
One More Thing
There are hundreds of thousands of certified coins in holders with the designations AU50, AU53, AU55, and AU58. If the definition of the AU part of the scale were changed, how could you tell these old coins designated AU50 (slight flatness on high points) apart from the new designation AU50 (many marks but slight wear)? To avoid this confusion the AU part of the scale should be renamed to About Mint State (abbreviated AM). The coins in new holders can then be easily identified as having been graded with the new system, for example as AM50.