Automated Coin Grader

Richard Bassett – April 3, 2002Updated: July 23, 2003

Asst. Professor Information Systems

Western CT State University

Goal of Project

• Develop a system that will be used to grade, appraise and authenticate valuable collectibles items such as rare coins providing consistent and repeatable results.

What is Grading?

• Assigning a grade to coins, or other rare collectibles, helps to establish the condition and the state of preservation of the collectible. Accurately determining the condition of a coin is significant as it is a large contributing factor to determining the value of a collectible in the marketplace.

Rationale• Rare coins are presently graded by human

hand and eye inspection that often produces varied, inconsistent and sometimes dubious results.

• A difference of a single grade can often mean thousands of dollars in the value of the asset.

• Judgment is suspect with subjectivity and great financial incentives entrenched in the process.

• Even the experts have difficulty arriving at a consensus

Even the experts have difficulty arriving at a consensus

Source:

An online grading Quiz had the following results:G (1) VF20 (15) EF40 (33) AU50 (5)

F12 (2) VF30 (28) EF45 (24) AU55 (1)

F15 (3)

Diversity in Denominations

creates tremendous challenges 1

Cent

5

Cent

10

Cent

25

Cent

50

Cent

1

DollarLarge Cent

1793 - 1857

Liberty

1883 – 1913

Barber

1892 – 1916

Barber

1982 – 1916

Walking Liberty

1916 - 1947

Eisenhower

1971 –

1978

Flying Eagle

1856 – 1858

Buffalo

1913 – 1938

Winged Mercury

1916 –

1945

Liberty

1916 – 1932

Franklin

1948 - 1963

SB Anthony

1979 –

1999

Lincoln Cent

1909 – Present

Jefferson

1938 – Present

Roosevelt

1946 - Present

Washington

1932 - Present

Kennedy

1964 –

Present

Sacagawea

2000 –

Present

What about my pocket change?

• Modern business strike coins intended for circulation are worth little more than face value as they are made in very large quantities.

Raw Coins

• Loose coins• Can be circulating

currency, like the change in your pocket.

• Can be uncirculated currency, like rolls of coins, that are pulled / hoarded before reaching the public.

Slabbed Coins• Raw coins that are graded

by for profit companies. There have been 72 grading companies since 1986.

• Coins are sealed in holders to protect them & prevent tampering.

• A method of trading ‘sight unseen’

• Still a subjective process as there are large inconsistencies between grading companies.

• Grades are suspected to be at Market Grade not true technical grade

What is a rare coin?

• Factors that often determine the rarity of a coin, and hence the value, include: # struck, estimated surviving population, varieties, market size, supply/demand and sometimes age.

Example of Rarities1909 Lincoln Cent

• Although almost 100 years old, the 1909 is not a rarity itself as 72.7 million were struck and many still survive.

• But the 1909-S (1.8 million) and 1909-S VDB (.5 million) are rarities, especially the latter.

Example of Rarities1909-S VDB Cent Values

• Good - $430• Fine - $590• Extra Fine - $700• MS-60 - $875• MS-63 - $975• MS-65 - $1250

Source: PCGS – Collectors Universe Apr. 2002

Example of Modern Rarity1995-W Silver Eagle

• Only 30,000 exist

• Struck at West Point

• This coin was free as part of Commemorative set in 1995

• Has a current value of $2,000 - $4,500

• It is the corner stone in completing a collection, thus creating a strong demand

Example of Rarities1856 Flying Eagle

Cent Values

• Good - $4,550• Fine - $5,600• Extra Fine - $6,500• MS-60 - $8,975• MS-63 - $14,500• MS-65 - $19,000

Source: PCGS – Collectors Universe Apr. 2002

Less than 2500 of these pattern coins were minted

Research questions investigated

• How bad are the 3rd party grading services?• How diverse are the interpretations of experts when it

comes to grading rare collectibles?• Is grading an art or a science?• Can a system be built that can reliably and consistently

determine the grade/condition of a rare collectible?• Is present day scanning technology sufficient enough

to provide images that are robust enough? • Is it possible to train a system with enough expert

knowledge from the collectible domains to properly perform feature recognition?

• Does specialized hardware have to be developed to accomplish the goal ?

Automated Coin Grader Wrap Up

Boldly going where 2 others have been in the past…

PCGS & Compugrade