Gold coin - AbsoluteAstronomy.com

A gold
Gold
Gold is a chemical element with the symbol Au and an atomic number of 79. Gold is a dense, soft, shiny, malleable and ductile metal. Pure gold has a bright yellow color and luster traditionally considered attractive, which it maintains without oxidizing in air or water. Chemically, gold is a...

coin is a coin

Coin

A coin is a piece of hard material that is standardized in weight, is produced in large quantities in order to facilitate trade, and primarily can be used as a legal tender token for commerce in the designated country, region, or territory....

made mostly or entirely of gold. Gold has been used for coins practically since the invention of coinage

History of coins

The history of coins extends from ancient times to the present, and is related to economic history, the history of minting technologies, the history shown by the images on coins, and the history of coin collecting. Coins are still widely used for monetary and other purposes.All western histories of...

, originally because of gold's intrinsic value. In modern times, most gold coins are intended either to be sold to collectors

Coin collecting

Coin collecting is the collecting or trading of coins or other forms of minted legal tender.Coins of interest to collectors often include those that circulated for only a brief time, coins with mint errors and especially beautiful or historically significant pieces. Coin collecting can be...

, or to be used as bullion coin

Bullion coin

A bullion coin is a coin struck from precious metal and kept as a store of value or an investment, rather than used in day-to-day commerce. Investment coins are generally coins that have been minted after 1800, have a purity of not less than 900 thousandths and are or have been a legal tender in...

s—coins whose nominal value is irrelevant and which serve primarily as a method of investing in gold

Gold as an investment

Of all the precious metals, gold is the most popular as an investment. Investors generally buy gold as a hedge or harbor against economic, political, or social fiat currency crises...

.

Gold has been used as money

Money

Money is any object or record that is generally accepted as payment for goods and services and repayment of debts in a given country or socio-economic context. The main functions of money are distinguished as: a medium of exchange; a unit of account; a store of value; and, occasionally in the past,...

for many reasons. It is fungible, with a low spread

Bid-offer spread

The bid–offer spread for securities is the difference between the prices quoted for an immediate sale and an immediate purchase...

between the prices to buy and sell. Gold is also easily transportable, as it has a high value to weight ratio, compared to other commodities, such as silver

Silver

Silver is a metallic chemical element with the chemical symbol Ag and atomic number 47. A soft, white, lustrous transition metal, it has the highest electrical conductivity of any element and the highest thermal conductivity of any metal...

. Gold can be divided into smaller units, without destroying its value; it can also be melted into ingots, and re-coined. The density

Density

The mass density or density of a material is defined as its mass per unit volume. The symbol most often used for density is ρ . In some cases , density is also defined as its weight per unit volume; although, this quantity is more properly called specific weight...

of gold is higher than most other metals, making it difficult to pass counterfeit

Counterfeit

To counterfeit means to illegally imitate something. Counterfeit products are often produced with the intent to take advantage of the superior value of the imitated product...

s. Gold is extremely unreactive. The scarcity of gold stabilizes its value.

Antiquity

Gold

Gold is a chemical element with the symbol Au and an atomic number of 79. Gold is a dense, soft, shiny, malleable and ductile metal. Pure gold has a bright yellow color and luster traditionally considered attractive, which it maintains without oxidizing in air or water. Chemically, gold is a...

was used in commerce (besides other precious metals) in the Ancient Near East

Ancient Near East

The ancient Near East was the home of early civilizations within a region roughly corresponding to the modern Middle East: Mesopotamia , ancient Egypt, ancient Iran The ancient Near East was the home of early civilizations within a region roughly corresponding to the modern Middle East: Mesopotamia...

since the Bronze Age

Bronze Age

The Bronze Age is a period characterized by the use of copper and its alloy bronze as the chief hard materials in the manufacture of some implements and weapons. Chronologically, it stands between the Stone Age and Iron Age...

, but coin

Coin

s proper originated much later, during the 6th century BC, in Anatolia

Anatolia

Anatolia is a geographic and historical term denoting the westernmost protrusion of Asia, comprising the majority of the Republic of Turkey...

. The name of king Croesus

Croesus

Croesus was the king of Lydia from 560 to 547 BC until his defeat by the Persians. The fall of Croesus made a profound impact on the Hellenes, providing a fixed point in their calendar. "By the fifth century at least," J.A.S...

of Lydia

Lydia

Lydia was an Iron Age kingdom of western Asia Minor located generally east of ancient Ionia in the modern Turkish provinces of Manisa and inland İzmir. Its population spoke an Anatolian language known as Lydian....

remains associated with the invention (although the Parian Chronicle

Parian Chronicle

The Parian Marble or Parian Chronicle is a Greek chronological table, covering the years from 1581 BC to 264 BC, inscribed on a stele...

mentions Pheidon

Pheidon

Pheidon was a king of Argos, Greece in the 7th century BC. At that time, the monarch was purely a traditional figurehead with almost no genuine power. Pheidon seized the throne from the reigning aristocracy...

of Argos

Argos

Argos is a city and a former municipality in Argolis, Peloponnese, Greece. Since the 2011 local government reform it is part of the municipality Argos-Mykines, of which it is a municipal unit. It is 11 kilometres from Nafplion, which was its historic harbour...

as a contender). In 546 BC, Croeseus was captured by the Persians, who adopted gold as the main metal for their coins.

The Ying yuan is an early gold coin minted in ancient China.

Larger units of monetary value and exchange such as the talent were the ancient equivalents of the modern 400-troy-ounce "good delivery" gold bullion bar.

Middle Ages and Early Modern period

Modern history

The German gold mark

German gold mark

The Goldmark was the currency used in the German Empire from 1873 to 1914.-History:Before unification, the different German states issued a variety of different currencies, though most were linked to the Vereinsthaler, a silver coin containing 16⅔ grams of pure silver...

was introduced in 1873 in the German Empire

German Empire

The German Empire refers to Germany during the "Second Reich" period from the unification of Germany and proclamation of Wilhelm I as German Emperor on 18 January 1871, to 1918, when it became a federal republic after defeat in World War I and the abdication of the Emperor, Wilhelm II.The German...

, replacing the various local Gulden

Reichsmünzordnung

The Reichsmünzordnung was an attempt to unify the numerous disparate coins in use in the various states of the Holy Roman Empire in the 16th century....

coins of the Holy Roman Empire

Holy Roman Empire

The Holy Roman Empire was a realm that existed from 962 to 1806 in Central Europe.It was ruled by the Holy Roman Emperor. Its character changed during the Middle Ages and the Early Modern period, when the power of the emperor gradually weakened in favour of the princes...

.

Gold coins then had a very long period as a primary form of money

Money

, only falling into disuse in the early 20th century. Most of the world stopped making gold coins as currency

Currency

In economics, currency refers to a generally accepted medium of exchange. These are usually the coins and banknotes of a particular government, which comprise the physical aspects of a nation's money supply...

by 1933, as countries switched from the gold standard

Gold standard

The gold standard is a monetary system in which the standard economic unit of account is a fixed mass of gold. There are distinct kinds of gold standard...

due to hoarding during the worldwide economic crisis of the Great Depression

Great Depression

The Great Depression was a severe worldwide economic depression in the decade preceding World War II. The timing of the Great Depression varied across nations, but in most countries it started in about 1929 and lasted until the late 1930s or early 1940s...

. In the United States, 1933's Executive Order 6102

Executive Order 6102

Executive Order 6102 is an Executive Order signed on April 5, 1933, by U.S. President Franklin D. Roosevelt "forbidding the Hoarding of Gold Coin, Gold Bullion, and Gold Certificates within the continental United States"...

forbade the hoarding of gold and was followed by a devaluation of the dollar relative to gold, although the United States did not completely uncouple the dollar from the value of gold until 1971.

Gold-colored coins have made a comeback in many currencies. However, "gold coin" (in numismatic terminology) always refers to a coin that is (more or less) made of gold, and does not include coins made of manganese brass or other alloys. Furthermore, many countries continue to make legal tender

Legal tender

Legal tender is a medium of payment allowed by law or recognized by a legal system to be valid for meeting a financial obligation. Paper currency is a common form of legal tender in many countries....

gold coins, but these are primarily meant for collectors and investment purposes and are not meant for circulation.

Collector coins

Many factors determine the value of a gold coin, such as its rarity, age, condition and the number originally minted. Gold coins coveted by collectors include the Aureus

Aureus

The aureus was a gold coin of ancient Rome valued at 25 silver denarii. The aureus was regularly issued from the 1st century BC to the beginning of the 4th century, when it was replaced by the solidus...

, Solidus

Solidus (coin)

The solidus was originally a gold coin issued by the Romans, and a weight measure for gold more generally, corresponding to 4.5 grams.-Roman and Byzantine coinage:...

and Spur Ryal

Spur Ryal

The Spur Royal was an extremely rare English gold coin issued in the reign of King James I. The coin is a development of the earlier Rose Noble, or Ryal which was worth ten shillings when issued by Kings Edward IV and Henry VII, and fifteen shillings when issued by Queens Mary and Elizabeth I.The...

.

In July 2002, a very rare $20 1933 Double Eagle

1933 Double Eagle

The 1933 double eagle currently holds the record for the highest price paid at auction for a single U.S. coin when it was purchased for US$7.59 million...

gold coin sold for a record $7,590,020 at Sotheby's

Sotheby's

Sotheby's is the world's fourth oldest auction house in continuous operation.-History:The oldest auction house in operation is the Stockholms Auktionsverk founded in 1674, the second oldest is Göteborgs Auktionsverk founded in 1681 and third oldest being founded in 1731, all Swedish...

, making it by far the most valuable coin ever sold to date. In early 1933, more than 445,000 Double Eagle coins were struck by the U.S. Mint, but most of these were surrendered and melted down following Executive Order 6102

Executive Order 6102

. Only a few coins survived.

In 2007 the Royal Canadian Mint

Royal Canadian Mint

The Royal Canadian Mint produces all of Canada's circulation coins, and manufactures circulation coins on behalf of other nations. The Mint also designs and manufactures: precious and base metal collector coins; gold, silver, palladium, and platinum bullion coins; medals, as well as medallions and...

produced a 100 kilograms (220.5 lb) gold coin with a face value of $1,000,000, though the gold content was worth over $2 million at the time. It measures 50 centimetres (19.7 in) in diameter and is 3 centimetres (1.2 in) thick. It was intended as a one-off to promote a new line of Canadian Gold Maple Leaf

Canadian Gold Maple Leaf

The Canadian Gold Maple Leaf is the official bullion gold coin of Canada, and is produced by the Royal Canadian Mint. The brainchild of Walter Ott, it is one of the purest gold regular-issue coins in the world with a gold content of .9999 millesimal fineness , with some special issues .99999 fine...

coins, but after several interested buyers came forward the mint announced it would manufacture them as ordered and sell them for between $2.5 million and $3 million. As of May 3, 2007, there were five orders.
Austria had previously produced a 37 centimetres (14.6 in) diameter 31 kg Philharmonic gold coin with a face value of €

Euro

The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...

100,000.

On October 4, 2007, David Albanese (president of Albanese Rare Coins) stated that a $10, 1804-dated eagle coin (made for President Andrew Jackson

Andrew Jackson

Andrew Jackson was the seventh President of the United States . Based in frontier Tennessee, Jackson was a politician and army general who defeated the Creek Indians at the Battle of Horseshoe Bend , and the British at the Battle of New Orleans...

as a diplomatic gift) was sold to an anonymous private collector for $5 million.

Bullion coins

Precious metals in bulk form are known as bullion, and are traded on commodity markets. Bullion metals may be cast into ingots, or minted into coins. The defining attribute of bullion is that it is valued by its mass and purity rather than by a face value

Face value

The Face value is the value of a coin, stamp or paper money, as printed on the coin, stamp or bill itself by the minting authority. While the face value usually refers to the true value of the coin, stamp or bill in question it can sometimes be largely symbolic, as is often the case with bullion...

as money. While obsolete gold coins are primarily collected for their numismatic value, gold bullion coins today derive their value from the metal (gold) content — and as such are viewed by some investors as a "hedge

Hedge (finance)

A hedge is an investment position intended to offset potential losses that may be incurred by a companion investment.A hedge can be constructed from many types of financial instruments, including stocks, exchange-traded funds, insurance, forward contracts, swaps, options, many types of...

" against inflation

Inflation

In economics, inflation is a rise in the general level of prices of goods and services in an economy over a period of time.When the general price level rises, each unit of currency buys fewer goods and services. Consequently, inflation also reflects an erosion in the purchasing power of money – a...

or a store of value

Store of value

A recognized form of exchange can be a form of money or currency, a commodity like gold, or financial capital. To act as a store of value, these forms must be able to be saved and retrieved at a later time, and be predictably useful when retrieved....

. Many nations mint bullion coin

Bullion coin

s. Investment coins are generally coins that have been minted after 1800, have a purity of not less than 900 thousands and is or has been a legal tender in its country of origin. Although nominally issued as legal tender

Legal tender

, these coins' face value as currency is far below that of their value as bullion.

The European Commission

European Commission

The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union's treaties and the general day-to-day running of the Union....

publishes annually a list of gold coins which must be treated as investment gold coins in all EU Member States. The list has legal force and supplements the law. In the United Kingdom

United Kingdom

The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...

, HM Revenue and Customs have added an additional list of gold coins alongside the European Commission list. These are gold coins that HM Revenue & Customs recognise as falling within the exemption for investment gold coins. This second list does not have legal force.

South Africa

South Africa

The Republic of South Africa is a country in southern Africa. Located at the southern tip of Africa, it is divided into nine provinces, with of coastline on the Atlantic and Indian oceans...

introduced the Krugerrand

Krugerrand

The Krugerrand is a South African gold coin, first minted in 1967 to help market South African gold. The coin, produced by the South African Mint, proved popular and by 1980 the Krugerrand accounted for 90% of the gold coin market. The name itself is a compound of Kruger and rand, the South...

in 1967 to cater to this market; this was the reason for its convenient and memorable gold content — exactly one troy ounce

Troy ounce

The troy ounce is a unit of imperial measure. In the present day it is most commonly used to gauge the weight of precious metals. One troy ounce is nowadays defined as exactly 0.0311034768 kg = 31.1034768 g. There are approximately 32.1507466 troy oz in 1 kg...

. It was the first modern, low-premium (i.e. priced only slightly above the bullion value of the gold) gold bullion coin

Bullion coin

. Bullion coins are also produced in fractions of an ounce – typically half ounce, quarter ounce, and one-tenth ounce. Bullion coins sometimes carry a face value

Face value

as legal tender

Legal tender

,
The face value is minted on the coin, and it is done so in order to bestow legal tender status on a coin, which generally makes it easier to import or export across national borders, as well as subject to counterfeit

Counterfeit

To counterfeit means to illegally imitate something. Counterfeit products are often produced with the intent to take advantage of the superior value of the imitated product...

ing. However, their real value is measured as dictated by their troy weight

Troy weight

Troy weight is a system of units of mass customarily used for precious metals, gemstones, and black powder.There are 12 troy ounces per troy pound, rather than the 16 ounces per pound found in the more common avoirdupois system. The troy ounce is 480 grains, compared with the avoirdupois ounce,...

, the current market price of the precious metal

Precious metal

A precious metal is a rare, naturally occurring metallic chemical element of high economic value.Chemically, the precious metals are less reactive than most elements, have high lustre, are softer or more ductile, and have higher melting points than other metals...

contained, and the prevailing premium that market wishes to pay for those particular bullion coins. The face value is always significantly less than the bullion value of the coin. Legal tender bullion coins are a separate entity to bullion gold. One enjoys legal tender status, the latter is merely a raw commodity. Gold has an international currency

Currency

code of XAU under ISO 4217

ISO 4217

ISO 4217 is a standard published by the International Standards Organization, which delineates currency designators, country codes , and references to minor units in three tables:* Table A.1 – Current currency & funds code list...

. ISO 4217 includes codes not only for currencies, but also for precious metals (gold

Gold

, silver

Silver

, palladium

Palladium

Palladium is a chemical element with the chemical symbol Pd and an atomic number of 46. It is a rare and lustrous silvery-white metal discovered in 1803 by William Hyde Wollaston. He named it after the asteroid Pallas, which was itself named after the epithet of the Greek goddess Athena, acquired...

and platinum

Platinum

Platinum is a chemical element with the chemical symbol Pt and an atomic number of 78. Its name is derived from the Spanish term platina del Pinto, which is literally translated into "little silver of the Pinto River." It is a dense, malleable, ductile, precious, gray-white transition metal...

; by definition expressed per one troy ounce

Troy ounce

, as compared to "1 USD") and certain other entities used in international finance, e.g. Special Drawing Rights

Special Drawing Rights

Special Drawing Rights are supplementary foreign exchange reserve assets defined and maintained by the International Monetary Fund . Not a currency, SDRs instead represent a claim to currency held by IMF member countries for which they may be exchanged...

.

Gold bullion coins usually come in 1 oz, 1/2 oz, 1/4 oz, 1/10 and 1/20 oz. sizes. Most countries have one design that remains constant each year; others (such as the Chinese Panda coins

Chinese Gold Panda

The Chinese Gold Panda is a series of gold bullion coins issued by the People's Republic of China. The official mint of the People's Republic of China introduced the Panda gold bullion coins in 1982. The panda design changes every year and the gold Panda coins come in different sizes and...

) have variations each year, and in most cases each coin is dated. A 1/10 oz bullion coin is about the same size as a U.S. dime. A 1 oz. gold bullion coin is about the size of a U.S. half dollar.
Other gold bullion coins, many named after their design features, include:

Austrian Philharmonic
British Britannia
Britannia coin
Britannia coins are British bullion coins issued by the Royal Mint in gold since 1987 and in silver since 1997.Britannia gold coins contain one troy ounce of gold and have a face value of £100. Gold Britannias also are issued in fractional sizes of one-half, one-quarter, and one-tenth of a troy...
Canadian Maple Leaf
Canadian Gold Maple Leaf
The Canadian Gold Maple Leaf is the official bullion gold coin of Canada, and is produced by the Royal Canadian Mint. The brainchild of Walter Ott, it is one of the purest gold regular-issue coins in the world with a gold content of .9999 millesimal fineness , with some special issues .99999 fine...
Chinese Panda
Chinese Gold Panda
The Chinese Gold Panda is a series of gold bullion coins issued by the People's Republic of China. The official mint of the People's Republic of China introduced the Panda gold bullion coins in 1982. The panda design changes every year and the gold Panda coins come in different sizes and...
Gold Dinar
Islamic gold dinar
The modern Islamic gold dinar is a currency that aims to revive the historical gold dinar which was a leading coin of early Islam. They consist of minted gold coins, Dinar, and silver coins, Dirham.-Dinar history:According to Islamic law, the Islamic dinar is a coin of pure gold weighing...
Malaysian Kijang Emas
Kijang Emas
The Malaysian Kijang Emas is the official bullion gold coin of Malaysia and is minted by the Royal Mint of Malaysia. It was first issued in 17 July 2001. Malaysia is the 12th country in the world to issue its own gold bullion coin....
Russian Chervonets
Chervonets
.Chervonets is a former currency of the Russian Empire and Soviet Union. Originally a term for coins of purer alloy the name was later applied to various sums in Russian rubles.Before the reign of Peter I, the name chervonets was applied to various foreign...
Russian George the Victorious
Swiss Vreneli
Vreneli
Vreneli is the informal name for a range of legal tender gold coins produced in Switzerland. The formal name is: Tête d'Helvetia , Helvetiakopf or Helvetia Head . The coins were issued between 1897 and 1936, in 1947 and in 1949.-Description:These coins had face values of 10, 20 and 100 Swiss...
French Napoleon
Napoleon (coin)
The Napoleon is the colloquial term for a former French gold coin. The coins were minted in denominations of , , , , and francs. This article will focus on the 20 franc coins issued during the reign of Napoleon, which are 21 mm in diameter, weigh 6.45 grams and, at 90% pure, contain 0.1867...
Australian Gold Nugget
Australian Gold Nugget
The Australian Gold Nugget is a gold bullion coin minted by the Perth Mint. The coins have been minted in denominations of 1/20 oz, 1/10 oz, 1/4 oz, 1/2 oz, 1 oz, 2 oz, 10 oz, and 1 kg of 24 carat gold...

Fineness of gold coins

Coins are usually made of an alloy as other metals are mixed into the coin to make it more durable. Fineness is the actual gold content in a coin or bar and expressed as a "per mil," or thousandths, so .999 is 999 thousandths of the weight are pure gold, the other 1/1000 is an alloy.

Karat weight is a unit of fineness for gold equal to 1/24 part of pure gold in an alloy. For example, pure gold which is 1000 fine. Below is a karat weight to fineness conversion chart.

Correlation between karats and fineness

24 carats = 1000 fine
23 carats = 958.3 fine
22 carats = 916.6 fine
21 carats = 875.0 fine
20 carats = 833.3 fine
18 carats = 750.0 fine
16 carats = 666.7 fine
14 carats = 583.3 fine
10 carats = 416.6 fine

The fineness is often converted to a percent, as well. If a gold coin has a fineness of .900, that is 90.0% pure gold. If a gold coin has a fineness of .850, then the gold coin is 85.0% pure.

Coins have varied greatly in fineness through history. Notable historical standards that were closely adhered-to include the crown gold

Crown gold

Crown gold is a 22 karat gold alloy, introduced in England for gold crown coin manufacture in 1526 . It is 22/24 = 0.91667 fine or 91.667% gold....

(22 karat) used in all English gold coins intended for circulation from 1526 onward, and 0.900 fine (21.6 kt), the standard for all American circulation-coins from 1837 onward.

Fineness is not the only way to value a gold coin; a great deal of value in collector coins comes from condition and rarity. To a far lesser extent, even the value of gold bullion coins is influenced by their physical condition.

Grading coins

A coin's "grade" is a visual evaluation of the amount of wear on a coin. Coins with little wear are graded higher and therefore assigned higher prices than those with a lot of wear. However, low-grade, extremely rare coins can easily be more valuable than more widely available, higher grade coins of common dates.

In the early years of coin collecting, three general terms were used to describe a coin's grade:

Good - Where details were visible but circulation had worn the surface
Fine - Features were less worn from circulation and a bit of the mint luster showed on the surfaces
Uncirculated - Details were sharp and there was a luster approaching the state of the coin at the mint, prior to general circulation

As the collector market for coins grew rapidly in the late 19th century and early 20th century, it became apparent that a more precise grading standard was needed. Some coins were simply more fine than others, and some uncirculated coins showed more luster and far fewer marks than others. Terms like "gem uncirculated" and "very fine" began to see use, as more precise grading descriptions allowed for more precise pricing for the booming collector market. In 1948, a well-known numismatist by the name of Dr. William Sheldon attempted to standardized coin grading by proposing what is now known as the Sheldon Scale.

Sheldon's scale, included in his famous work "Penny Whimsy", was originally devised specifically for United States large cents, but it is now applied to all series. The scale runs from 0 to 70, where 0 means that you can tell that it was once a coin while 70 means that it is perfect. 60 is uncirculated, what the general public would consider perfect, with no wear whatsoever. There is a direct mapping from this scale to the older descriptive terms, but they are not always used in the same way.

Below are the general characteristics that define different coin grades. When grading coins, any defect should be noted, such as bent, scratched, etc.. Cleaning or mutilations of any kind should be mentioned.

Basal - (Mint State 1) A piece of metal that can be identified as a coin
Fair - (Mint state 2) The type of coin can be identified, the date may or may not be visible.
Almost Good (AG) - (Mint State 3) The date can be read, but parts of the coin and legend are worn smooth.
Good (G) - (Mint state 4 and 6) Legends, designs and dates are visible but heavily worn.
Very Good (VG) - (Mint State 8 and 10) Designs and date are clear but lacking details. The "full rim" (the line around the edge of the coin where it was raised up) must be visible.
Fine (F) - (Mint state 12 and 15) All major details will be visible with the major details virtually complete. In this case, "Fine" describes concerning the condition of the coin - not the purity as described above.
Very Fine (VF) - (Mint state 20, 25, 30, and 35). More details are visible with major details virtually complete.
Extremely Fine (XF or EF) - (Mint state 40 and 45) Light wear on the high points with some mint luster present.
Almost Uncirculated (AU) - (Mint state 50, 53, 55, and 58) Small trace of wear visible on the highest points with at least half of the mint luster still present.
Uncirculated (UNC) - (Mint state 60 to 70) No trace of wear with some small nicks or marks present.
Proof (PF) - Coins specially struck for collectors. Usually mirror-like surface. Sand blast and matte proof in some series.

Mint State (MS) - (Mint state 60 - 70) "Uncirculated" and "Mint State" are terms that are many times used interchangeably. MS 70 is considered a perfect coin. Extremely few regular issue coins are considered MS-70 although it is common for new, modern bullion coins to be given a grade of MS-70.
The grading standards are different in different countries. The main standards applied outside the United States are presented in the following table. Coin grading is not an exact science. It is a subjective exercise and depends on the qualification and the experience of the appraiser. Industry leaders were extremely concerned that without a standardized grading system, the rare coin industry could face enormous problems. Therefore on February 3, 1986 the Professional Coin Grading Service

Professional Coin Grading Service

PCGS is the acronym for Professional Coin Grading Service a third party grading service for grading rare coins. Founded in 1986, and located in Newport Beach, CA., it is a subsidiary of Collector's Universe, Inc. , a company that also buys and sells rare coins and operates a rare comic book...

(PCGS) was formed and in 1987 the Numismatic Guaranty Corporation

Numismatic Guaranty Corporation

The Numismatic Guaranty Corporation is a provider of third-party coin grading services to numismatists. The company was founded in 1987 and is headquartered in Sarasota, Florida...

. Both associations have the same goal of grading coins. Other prominent grading organizations are the American Numismatic Association Certification Service (ANACS) and the Independent Coin Graders. The grading is usually done by three independent appraisers. A grading finalizer assigns the final grade of the coin and thereafter the coin is sonically sealed in a protective, inert plastic holder known as "slab". Other associations followed and are at present active.

This third-party appraisal of a coin's physical condition, backed by a guarantee, and a national network of reputable coin dealers provided an extremely reliable form of protection for rare coin consumers who could then participate in the coin market with greater confidence.

Rarity factor

The value of coins depends on their rarity. There are several scales which have been developed for the definition of the rarity of a particular coin. The most common are the "Sheldon rarity scale" and the "Universal rarity scale"

Counterfeits

For most of history, coins were valued based on the precious metal they contain. Whether or not a coin was actually made by the party as claimed was of secondary importance compared to whether or not it contains the correct amount of metal - that is, correct weight and fineness (purity). Genuine appearance was simply a convenient shortcut to avoid time-consuming tests in everyday transactions.

Unlike silver, gold is denser than almost all other metals, hence whether something is made of gold is extremely hard to fake. Simple determination of weight and volume should be sufficient. A coin that is the right size but is not gold, or has too much base metal, will be "light"; alternately, a coin that weighs right will be somewhat larger. (Platinum was unknown in ancient times; platinum

Platinum

is denser than gold, but since the price of platinum is usually higher than that of gold, making a fake coin out of platinum would make no sense. In theory, fake coins could be made of uranium

Uranium

Uranium is a silvery-white metallic chemical element in the actinide series of the periodic table, with atomic number 92. It is assigned the chemical symbol U. A uranium atom has 92 protons and 92 electrons, of which 6 are valence electrons...

, but this does not appear to be a practical solution. One element that has just about the same density as gold is tungsten

Tungsten

Tungsten , also known as wolfram , is a chemical element with the chemical symbol W and atomic number 74.A hard, rare metal under standard conditions when uncombined, tungsten is found naturally on Earth only in chemical compounds. It was identified as a new element in 1781, and first isolated as...

. Alloying gold with tungsten would not work for several reasons but a coin with a tungsten center and gold all around it could not be detected as counterfeit by density measurement alone.

An old practice to test whether a gold coin was counterfeit was to bite down on it. Since pure gold is relatively soft any base metals mixed with the gold to lessen its value will also harden the coin, and so make it harder to bite on. Another explanation of this practice is that historic gold coins were usually alloyed with silver and copper which make them harder than pure gold and less prone to wear. Counterfeits could be made of lead to approximate the weight of gold and covered with a thin layer of real gold. Biting the coin would mark the softer lead or scratch through the veneer revealing the base metal underneath.

The majority of bullion counterfeits (of all types) are rare, and fairly easy to detect when comparing their weights, colors and sizes to authentic pieces. This is because the cost of reproducing any given coin precisely can easily exceed the market value of the originals.

Numismatic fake samples

There are well made counterfeit

Counterfeit

To counterfeit means to illegally imitate something. Counterfeit products are often produced with the intent to take advantage of the superior value of the imitated product...

gold coins in circulation. For example, the St. Gaudens Double Eagle

St. Gaudens Double Eagle

The Saint-Gaudens double eagle is a twenty-dollar gold coin, or double eagle, produced by the United States Mint from 1907 to 1933. The coin is named after its designer, the sculptor Augustus Saint-Gaudens, who designed the obverse and reverse. It is considered by many to be the most beautiful of U.S...

omega counterfeit is infamous for its complexity and has fooled many numismatics

Numismatics

Numismatics is the study or collection of currency, including coins, tokens, paper money, and related objects. While numismatists are often characterized as students or collectors of coins, the discipline also includes the broader study of money and other payment media used to resolve debts and the...

experts. It is a high relief business strike

Regular issue coinage

Business strike is a term that distinguishes coins created for commerce from commemorative coins and proof coins. Regular issue coins are normally produced in relatively large numbers, and are primarily meant to be used as pocket change, not collected...

, and due to the extensive wear on the die, these coins were not made for many years.

Another example is the US $20 gold coin ("double eagle

Double Eagle

A Double Eagle is a gold coin of the United States with a denomination of $20. . The coins are made from a 90% gold and 10% copper alloy....

"), which has raised lettering around its rim. If the coin is uncirculated, the letters will be flat on top. If slightly rounded, and the coin is uncirculated, it is a counterfeit. There are other counterfeit double eagles in which the gold and copper alloy was not thoroughly mixed. These counterfeits will have a slightly mottled appearance.

External links

US Mint: American Eagle Bullion Coins at the website of the United States Mint
United States Mint
The United States Mint primarily produces circulating coinage for the United States to conduct its trade and commerce. The Mint was created by Congress with the Coinage Act of 1792, and placed within the Department of State...

, US Department of the Treasury

The source of this article is wikipedia, the free encyclopedia. The text of this article is licensed under the GFDL.

Antiquity

Middle Ages and Early Modern period

Modern history

Collector coins

Bullion coins

Fineness of gold coins

Grading coins

Rarity factor

Counterfeits

Numismatic fake samples

See also

Further reading

External links