Bluesheet: TWO-TIERED MARKET FOR CERTIFIED COINS CONTINUES…

One of the biggest topics of discussion here at CDN is the need (or not) for Bluesheet pricing. The Bluesheet was born in 1986 from the emergence of third-party grading by PCGS, and later NGC. Other third party grading companies have come and gone, and others hang around, but the “big two” have remained solid over these three decades.

The Bluesheet was originally designed to represent “sight-unseen” bidding on the major commercial teletype systems. The idea at the time was that third-party grading would

become so reliable and standardized that rare coins would trade readily at sight unseen levels, investor markets would emerge and we would see a commoditization of the certified coin market.

As it turned out, dealers and collectors really weren’t willing to buy their coins without first seeing them. More importantly, they weren’t willing to post continuous bids on such items and the Bluesheet lost its primary source for the basis of pricing.

Indications in the sheet stagnated and could almost only go down based on the formula the editors used as a pricing model.

By the time we took over editorial control in mid-2016, the Bluesheet levels had largely failed to represent any part of the marketplace. The Bluesheet price bid indications had become so “safe” that it was nearly impossible to buy most coins at these levels at any competitive arena. The new approach we take is to scan market activity and determine the price floor for a specific item. We can illustrate with a randomly-selected example: the Lafayette commemorative dollar graded MS65-66.

As you can see from the adjacent table, the difference in values varies greatly from the Greysheet and Bluesheet. This circumstance is actually more common than not in the current market and is largely due to several factors, including but not limited to: (in)consistency of grading, eye appeal versus technical grade, CAC approval and market strength. All of these factors matter but a CAC sticker is currently the most reliable way to minimize risk in this market. You pay more for a stickered coin but there is more liquidity in many issues due, in large part, to the fact the CAC itself makes up the largest market of sight-unseen bidding in the industry today. These levels generally exceed sightseen of non-CAC approved coins, so CAC bids are represented in the Greysheet.

All of this noted, market strength is still the most important factor contributing to the disparity of Blue and Grey sheet prices. As coins come up for auction in must-sell

situations, coins tend to really suffer from a lack of general market depth. The good news is that retailers have been informing us that they are having increasing success selling coins to their collector base at fixed prices, often in the Blue-Grey spread. Collectors can truly benefit from the spreads of this two-tier market. Seek out beautiful coins and buy themas close to Bluesheet as possible.