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How to Make Money Cherrypicking
By Mike Thorne

As a college professor for many years, I begin each course by defining the subject. In Introductory Psychology, for example, I define psychology as the scientific study of behavior. From there, I go on to tell students what I mean by "scientific study" and "behavior."

But this is not psychology, although there may be some psychology involved, so I will begin this article by defining what I mean by "cherrypicking." This is a term you may have heard used by coin dealers or collectors without knowing exactly what it meant.

As it is used in the coin market, cherrypicking refers to buying a coin that, for some reason, is really worth more (often much more) than the price you paid for it. Continuing with the fruit terminology, cherrypicking may refer to finding a cherry mixed in with a group of prunes (or dried plums, as the prune sellers would have us call them).

As it turns out, there is more than one way to cherrypick coins, but they all require one thing: differential knowledge. That is, in order to be a successful cherrypicker, you need to have knowledge that the current owner of the "cherry" doesn't have.

Where are you going to acquire this differential knowledge? Are there classes on cherrypicking? Well, if there are, I'm not aware of them. For the most part, you're going to have learn to cherrypick on your own.

One thing you'll find, however, is that the knowledge needed to be a successful cherrypicker is not hidden. In fact, it's readily available from such sources as bookstores and online booksellers.

You may have heard one of the oft-quoted (and still true) lines in numismatics: Buy the book before you buy the coin. To this line, I would add "and read it." That is, I think the old saying should be: Buy the book and read it before you buy the coin.

Too many people buy the right books and then either never open them or skim through them looking at the pictures. Neither of these behaviors will make you a successful cherrypicker. In fact, you'll actually have to study and digest the material in order to become a cherrypicker.

So what books am I talking about? A couple of the best of the breed actually have a form of the word "cherrypicking" in their titles. I'm referring to Fivaz and Stanton's Cherrypickers' Guide to Rare Die Varieties of United States Coins, now midway into its fifth edition. That is, Cherrypickers' Guide comes in two volumes, and the fifth edition of the first volume has just ,been published as I write this. Presumably, the new edition of the second volume will soon follow.

With a list price of $39.95 per volume, the complete set of Cherrypickers' Guide is not cheap, but the information the books contain is invaluable. Of course, it's quite possible that you won't need both volumes to be a successful cherrypicker, if you decide to follow my recommendation to specialize. By this, I mean that you may be a better cherrypicker if you focus on one or a few series rather than trying to cherrypick in all series.

By way of analogy, look at what has happened in university subjects: Each field of study has become more and more differentiated, with smaller and smaller areas of specialization. A student today becomes an expert in one small area of specialization rather than trying to become a generalist and learn everything there is to know about the entire field.

The reason for this, of course, is that there's too much knowledge for anyone to know everything about a subject. And this is also true of coin series. There is so much known about popularly collected and well-researched series that it would be virtually impossible for any one person to learn all there is to know about many different series.

As a result, the most successful collectors and cherrypickers tend to specialize, to focus their efforts on one or two or perhaps a few series. In this way, they become experts in those series and know exactly what to look for if they have a cherrypicking opportunity.

Let's say that you decide to specialize in Lincoln cents before 1959, the wheat ears variety. If you consult the 2009 edition of U.S. Coin Digest, published by Krause Publications, you'll find that beyond the basic date-mintmark varieties, there are 14 die varieties and overmintmarks (e.g., S over D, or vice versa). Of course, some of these are well known and quite popular (e.g., 1922 "no D," 1955 doubled die).

By contrast, I counted 69 varieties described in the first volume of the new edition of Cherrypickers' Guide. Obviously, if you want to cherrypick Lincoln cents, then you need to study Fivaz and Stanton's book.

Let me give you a few examples of the die varieties described in words and pictures in Cherrypickers' Guide. On p. 98, for example, there's a doubled-die obverse 1927 Lincoln, which is described as follows: "Moderate doubling is evident on the LIBE of LIBERTY, IN GOD WE TRUST, and slightly on the date." This variety is worth considerably more than the normal coin, which ranges in value from $1 to $50 in grades Very Fine through Mint State-65. In the same grades, the range for the doubled die is from $5 to $150.

On p. 99, there is a repunched mintmark on a 1929-S Lincoln. The variety is described as having a "secondary S mintmark . . . evident north of the primary mintmark." The authors comment, "This RPM is considered rare, and is tough to locate in any grade."

One book will not be enough for a true specialist, however, no matter how good it is. Other books you'll want to study are Shane Anderson's The Complete Lincoln Cent Encyclopedia, David Lange's The Complete Guide to Lincoln Cents, and Q. David Bowers' A Guide Book of Lincoln Cents. All of these were available on Amazon when I looked.

Of course, you would expect to find a wealth of information on a series as popular as Lincoln cents. What about other, less widely collected, series?

Here, too, you're likely to find a book or books on the subject. For example, for the last few years Whitman Publishing has been issuing individual guide books for either single series or for a group of series. These are called Official Red Books to link them with Whitman's long-running guide to retail coin values, A Guide Book of United States Coins.

According to the Lincoln cents guidebook, some of the other series covered by Official Red Books are gold $20s, type coins, modern proof sets, Buffalo and Jefferson nickels, Flying Eagle and Indian Head cents, Barber silver coins, Morgan dollars, and Seated Liberty silver coins. Each of the volumes in this series is numbered, and the highest one I have is number 12 (gold dollars), which should give you some idea of the broad array of coin series covered.

Years ago, David Lawrence Rare Coins (DLRC) published a lengthy series of books about individual coin series. The title of each book began The Complete Guide to&, and some of the guides covered each of the Barber series, Buffalo nickels, Mercury dimes, Seated Liberty half dimes, Seated Liberty half dollars, and Walking Liberty half dollars. I checked their availability on Amazon and found that some are not available, whereas others are listed but often at humongous prices. For example, the guide to Walking Liberty half dollars, written by Bruce Fox and published in 1993, is represented by five used copies, with prices ranging from $164.95 to $237.06. When new, the list price on this book was $29.95. If you can find copies of any of the books in this series at reasonable prices, you should buy them both for the information they contain and for their investment potential.

Zyrus Press has recently entered the collectibles publishing market, and several of their books contain worthwhile information for anyone interested in cherrypicking particular series. For example, in 2007, Zyrus published the fourth edition of J.H. Cline's Standing Liberty Quarters, which is the definitive work on that series. On their Web site, they list such titles as A Handbook of 20th-Century U.S. Gold Coins: 1907-1933 (2nd edition), The Authoritative Reference on Buffalo Nickels, A Buyer's Guide to Silver Dollars & Trade Dollars of the United States, and Collecting and Investing Strategies for Walking Liberty Half Dollars.

Kevin Flynn is a prolific writer of books that will prove invaluable to the budding cherrypicker. Some of his books, often written with another author, have been published by Stanton Printing & Publishing (www.stantonbooks.com), whereas others have been published by Brooklyn Galleries Coins & Stamps, Inc. Some of the titles include The Authoritative Reference on Three Cent Nickels, Treasure Hunting Liberty Head Nickels, The Authoritative Reference on Barber Dimes, Treasure Hunting Mercury Dimes, and The Best of the Washington Quarter Doubled Die Varieties.

As you can see from this partial listing of book series and authors, there's a wealth of information available about die varieties in popularly collected series and also in some of the less popular series (e.g., nickel three-cent pieces). My suggestion is to pick a series or two that you really like and then accumulate and study as many of the die variety guides to that series as you can. Then put your knowledge into action at the next coin show you attend.

Of course, that brings up the question: In what venues can you apply your cherrypicking skills? Obviously, I think you can cherrypick dealers at coin shows, but are there other places where cherrypicking can occur?

One place is coin shops. Years ago I was visiting relatives in Houston, and one of my nephews and I set out to visit some coin shops in the city. Although we never made it downtown, we did locate a small shop near Rice University. As it turned out, the proprietor specialized in Latin American coins, which meant that when he bought collections for the scarce Mexican issues, for example, he wholesaled out all the U.S. material.

Some of these U.S. coins were dumped into a large "junk" box, which was kept on the counter. My nephew and I were invited to rummage through the box to see if there was anything of interest.

Well, I've seen junk boxes at coin shows and flea markets that really lived up to the name. That is, there was nothing but junk (e.g., badly worn and/or damaged Indian Head cents, rusty Shield and Liberty Head nickels, bent half dimes, etc.) in them, and this material was often overpriced. By contrast, the junk box that I looked through at the coin shop in Houston contained nothing but nice coins, and they were priced ridiculously low. As just one example that I remember, there was a solid Fine 1915-S Buffalo nickel with $1 marked on the holder.

Now, this was more than 25 years ago, when the 1915-S Buffalo was worth a lot less than now, but suffice it to say that even then the coin was worth considerably more than $1. When I discovered the wealth of material in the box, I made a huge mistake that should provide a lesson to anyone who wants to be a cherrypicker: If you find something worth considerably more than it's priced, take full advantage of it.

For reasons I can no longer recall, I bought something like $20 worth of coins from the box. What I should have done, of course, was to ask the dealer to quote me a price on the whole lot plus any more U.S. material he wanted to sell. Here was my chance to "break the bank," and I blew it.

Years earlier, when I was a kid going through sacks of coins almost daily, I found a combination coin shop and bookstore in downtown Shreveport. Although the word hadn't been adapted for use in the realm of coins, I spent hours cherrypicking the coins in this shop. The reason I was able to do this was that I knew a great deal more about grading than did the shop owners.

Trades were done, according to Red Book values, which were minuscule relative to today's values. The way the trade worked, I could have any of their coins at double Red Book for my coins at Red Book. Sounds like a sweet deal for the owners, right? The kicker was that they knew little or nothing about grading. In particular, in their eyes a coin was just as valuable with damage as it was without.

You can probably guess what happened. I gave them all my culls at Red Book for their nice coins at twice Red Book. In this way, I was able to acquire such coins as two uncirculated 1936-D quarters, several AU and uncirculated 1931-D dimes, and a VG-F 1908-S Indian Head cent.

Of course, this experience highlights another way that you can cherrypick: by knowing more about grading than the person you're dealing with. Cherrypicking by grade is done both with raw coins and with certified coins, and you may have even heard of people who play the "crackout" game. That is, they buy a certified coin they think is undergraded, crack it out of its holder, and resubmit it to either the same grading service or to another service in the hope of having it returned with a higher grade than the one at which they bought it.

One key to playing this game is to focus on coins that have a dramatic change in value from one grade to another. For example, if you bought an 1892-S Morgan dollar graded MS-63 that you really thought was an MS-64 or -65, you could double your money (or more) if you turned out to be right. Of course, this is an extreme example, but there are many better-date coins that take a big jump in value from one grade to the next.

Now, the secret to cherrypicking by grade is to be an expert at grading a particular series. And you can get this knowledge by studying grading guides and the guides to single series in some cases. (Many of the books that I mentioned above have sections on grading the particular series being discussed.)

For circulated coins, one of the grading guides you should study is Photograde: Official Photographic Grading Guide for United States Coins, by James F. Ruddy, which claims to be in its 19th edition. Actually, most of the "new" editions are really new printings, but I quibble; this is a good book to have in your library (and its contents in your head).

Another one that's a must for circulated and uncirculated coins is The Official American Numismatic Association Grading Standards for United States Coins (6th edition). Opt for the spiral-bound version, as this is a book that should see a lot of use. All of the grading guides I'll mention are quite inexpensive, by the way. Amazon lists this one new for only $11.53 plus shipping.

A rather quirky grading guide that's particularly worthwhile for its discussion of grading uncirculated coins is The Official Guide to Coin Grading and Counterfeit Detection (2nd edition), prepared by Professional Coin Grading Service (PCGS). Amazon's price for this large paperback book is just $13.57 plus shipping.

Last but definitely not least is Whitman's new grading book by Q. David Bowers, Grading Coins by Photographs: An Action Guide for the Collector and Investor. In addition to full-color photographs of coins to illustrate each major grade, Bowers' book contains a wealth of information on the general topic of grading, including the striking characteristics of coins in particular series.

As an example of why you should study this book carefully, particularly if you're interested in cherrypicking by grade, here's a quote from the introduction to Chapter 5, "Smart Grading and Buying": "A lot of knowledge can be very beneficial. If you read this text carefully, and combine this with some field work examining coins in person, you will know that a coin graded by someone else as EF-40, or MS-65, or some other number, may have features far beyond the number indicated." As a result, it may be ripe for picking.

Getting back to the topic of venues for cherrypicking, I am told that you can cherrypick at antique malls, although I have never encountered such an opportunity myself. When they've had them at all, the coins at the antique malls I've visited have typically been common, usually cleaned, and always overpriced. However, a numismatic friend with whom I've corresponded has had different experiences.

For example, he told me recently about a gem 1903 Indian Head cent he purchased for $42. He writes that it's "virtually flawless," and he would grade it MS-67 and appraise its value at $20,000. Although this value may be somewhat optimistic, if it certifies at least MS-65, it's worth considerably more than he paid for it.

Another venue in which I've had some success involves eBay auctions. I had several cherrypicking experiences with an eBay seller that I found to be a quite conservative grader. In one such experience, I bought a common-date Seated Liberty quarter the dealer graded Extremely Fine and sold it as an AU to another dealer at the next coin show I attended, more than doubling my money.

Similarly, a 1929-D Walking Liberty half that I bought from one of his auctions as an EF came back from a major grading service in an About Uncirculated-55 holder. Again, this resulted in a healthy profit for me, the cherrypicker.

As I think you can see from this discussion, if you acquire differential knowledge about a particular series, either about scarce die varieties or about grading, you can apply this knowledge to your advantage in a variety of settings. In fact, I believe that you can cherrypick in virtually any setting in which coins are exchanged for money.

Is cherrypicking easy? Not really. If it were easy, then everybody would do it. I can tell you, however, that the first time you do it successfully, you'll get a rush of pleasure that will make all your hard work and study worthwhile.


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