On the basis that no question is dumb, can someone please explain the expected value added by grading. Say a particular Panda (or any coin) in raw state is valued at $100.00. What would its likely value be if graded as say M67, M68, M69, M70. Thanks in advance.
just comes down to supply and demand ?? I don't think there's a formula for it. You can go to the grading websites to find out exactly how many of each are around.
The value that is added is certainty. If you buy a raw coin, maybe it's high quality, maybe it isn't. If you're an expert coin grader, you can tell the difference on your own. If you are not an expert in coin grading or you don't have the coin in your hand (you're buying online or whatever), then the grade gives you a guarantee as to overall quality. A 70 will be perfect, a 69 might have a very light scratch, etc on down the scale. The premiums for grading vary, but for pandas basically a 68 and a raw coin will sell around the same price. A 69 will sell for about 1.5 to 2 times the raw price, and a 70 will sell for 3 to 5 times the 69 price. Where you are on the ranges will depend on how common those grades are. So as an example, 1996 1 oz silver pandas are selling for about $150 in 69 grade, but $75 raw. So that's 2:1 (rough numbers). On the other hand, 2008 1 oz silver pandas are selling for about $90, but $60. So that's 1.5:1 (or 3:2 for math geeks). Why the difference? There are a lot more 2008 69s than 1996 69s! In short, grading adds another layer of distinction. So a coin's value will depend on mintage rarity, popularity, and grade rarity. Those who want the best of the best have to pay for it.
