Paper Currency Grading Standards and Guide

Paper currency grading is a complex process, but understanding the standards and guide can make it more manageable.

The Paper Currency Grading Standards are set by the Professional Currency Grading (PCG) and the Paper Money Guaranty (PMG), two of the most reputable companies in the industry.

The standards are based on a 100-point scale, with 100 being the highest grade. The grades are determined by the condition, rarity, and other factors of the note.

The most common grades are 1-10, 20-30, 40-50, and 60-70, with 10 being the lowest and 70 being the highest in these ranges.

To get a high grade, the note must be in excellent condition, with no creases, tears, or other damage. The paper must be crisp and clean, with no signs of aging or wear.

The PMG uses a microscope to examine the note at a 10x magnification level to determine the grade.

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The grading process for paper currency is a meticulous and thorough evaluation of a note's condition, rarity, and authenticity. Each grade is assigned based on a specific set of criteria.

Paper currency graders examine the note's centering, which refers to how well the design is aligned with the edges of the paper. A perfectly centered note is considered a major plus.

The condition of the paper is also evaluated, with notes graded from 1 to 5, with 5 being the highest grade. A grade of 1 indicates a note that is worn, torn, or has other significant damage.

A note's rarity is determined by its serial number, with some numbers being more scarce than others. Notes with low serial numbers are considered more rare and valuable.

The grade of a note is also influenced by its signature combination, which refers to the combination of signatures present on the note. Some signature combinations are more rare than others.

A note's grade is ultimately determined by its overall condition, rarity, and authenticity. A high-grade note is one that has been well-preserved and has a unique combination of characteristics.

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Grading paper currency can be subjective, but there are commonly acknowledged grades among collectors, including Poor, Good, Very Good, Fine, Extremely Fine, About Uncirculated, Choice Uncirculated, and Gem Uncirculated.

These grades are not just subjective opinions, but rather a way to evaluate the condition and quality of a note. For instance, a note scoring 70, dubbed "Gem Uncirculated", implies it exhibits no handling evidence even under high magnification.

Here's a breakdown of some key grades:

Keep in mind that the lower the grade, the more apparent the note's usage. A note rated 1, for example, indicates significant usage, resulting in a diminished value and "Poor" grading.

United States banknotes are graded on a scale that's similar to the 70 points Sheldon coin grading scale. Top-quality grades include "Gem" or "Choice" condition, which is often referred to as "New" by sellers.

These high-grade notes are usually in excellent condition, with minimal flaws. However, slight centering or registration flaws can differentiate a 69 EPQ note from a 70.

For a 68 EPQ note, you might start to notice minimal handling signs, while a 67 EPQ note may display slightly more apparent handling signs.

Choice Uncirculated notes are a step below Gem Uncirculated, with a 64 or 63 EPQ rating. These notes may have imperfect centering and handling signs.

A 64 EPQ rating indicates the note has some signs of handling, but no folding signs. In contrast, a 63 EPQ rating means the note has no signs of folding, but the margins are off-center.

Notes graded 64 and 63 EPQ are termed "Choice Uncirculated." Imperfect centering and handling signs are common in these notes.

Here's a breakdown of the characteristics of 64 and 63 EPQ notes:

These notes are still considered high-quality, but they don't meet the standards of Gem Uncirculated notes.

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Paper currency grading is a critical process for numismatists as it helps ascertain the worth of their banknotes. This practice employs a numerical scale from 1 to 70 to grade paper money, with a higher grade implying a greater value.

A higher grade, such as 70, is the pinnacle of quality, indicating a banknote in nearly perfect condition.

Grading also assists in verifying the authenticity of a banknote, serving as a safeguard against counterfeit currency.

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Authentic notes are verified through grading, which serves as a safeguard against counterfeit currency. Grading also helps define a note's market value, making it a crucial aspect of authenticity.

Grading is a process that helps distinguish authentic notes from counterfeit ones. It's not just about assigning a value to a note, but also about ensuring its genuineness.

Grading assists in verifying the authenticity of a banknote by evaluating its condition and features. This helps to prevent counterfeit currency from circulating in the market.

The value of a graded note is often higher than an ungraded one, making grading an important consideration for collectors and investors.

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Determining the value of a banknote is crucial for numismatists, and it's done by grading it on a numerical scale from 1 to 70.

A higher grade indicates a greater value, with 70 being the highest quality.

Money is a fundamental aspect of our lives, and it's essential to understand its importance in the context of authenticity and value. Money can buy us freedom and flexibility, allowing us to pursue our passions and interests without financial constraints.

Having enough money can provide a sense of security and stability, which is crucial for our mental and emotional well-being. According to research, people who feel financially secure are more likely to be happy and content.

Money can also give us the ability to make choices and live life on our own terms, rather than being tied to a 9-to-5 job just to make ends meet. This is especially true for creatives and entrepreneurs who value their independence and autonomy.

Having a steady income can also provide opportunities for personal growth and development, whether it's through education, travel, or hobbies. For instance, having a financial safety net can allow us to take risks and pursue new opportunities without fear of financial ruin.

Money can also serve as a means of exchanging value and services with others, facilitating trade and commerce in our economy.

PMG uses several designations to give an additional description to select notes, in addition to the 70-point numerical grading scale. These designations are Exceptional Paper Quality (EPQ), the PMG Star (*) Designation, and NET.

EPQ notes are considered completely original, with no material or chemical processing to improve their appearance. Notes with normal wear-and-tear for their grade are eligible for EPQ designation. All notes graded Very Fine 25 and higher will be evaluated for EPQ.

The PMG Star (*) Designation is assigned to notes with exceptional eye appeal for their assigned grade. This includes strong plate and overprint embossing, vibrant ink color, and pristine paper quality. All US and world notes are automatically evaluated for the Star Designation.

NET graded notes exhibit mishandling or problems more significant than expected for the assigned numeric grade. Common problems that may result in a NET grade include large tears, PVC damage, or extensive staining.

PMG uses several designations to give an additional description to select notes, in addition to their 70-point numerical grading scale.

The Exceptional Paper Quality (EPQ) designation is given to notes that are, in the opinion of PMG graders, completely original and have not been physically, chemically, or materially processed to give the appearance of a higher grade.

All notes graded Very Fine 25 and higher will be evaluated for the EPQ designation, and notes must qualify for the EPQ designation to grade Gem Uncirculated 65 and higher.

The PMG Star (*) Designation is awarded to notes with exceptional eye appeal for their assigned grade, exhibiting exceptionally strong plate and/or overprint embossing, vibrant ink color, and pristine paper quality exceeding the well-established standards used to determine the Exceptional Paper Quality (EPQ) Designation.

All US and world notes are automatically evaluated for the PMG Star (*) Designation, and notes graded PMG Gem Uncirculated 70 must also qualify for the PMG Star (*) and EPQ Designations.

A "Net" graded note is one that exhibits mishandling or problems that are more significant than one would expect for the assigned numeric grade, and the grade guarantee does not apply to Notes given a "Net" grade by PMG.

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I've found the PMG Guide and Designations to be a valuable resource for paper money collectors like myself. The guide provides a wealth of information on how to evaluate and grade paper currency.

David Hall, a seasoned collector, found the article to be a great source of information, easy to understand, and perfect for new collectors like himself. He appreciated the clarity and simplicity of the guide.

If you're new to collecting bank notes, you may have come across terms like "short run" or "changeover" in the description of graded notes. Ann, a fellow collector, asked for clarification on these terms and we're happy to help.

The terms "short run" and "changeover" refer to specific characteristics of the paper currency, but their exact meaning can be unclear without explanation. These terms are often used to describe the production process of paper currency.

Here are some key points to keep in mind when encountering these terms:

As a collector, it's essential to understand the significance of these terms when evaluating and grading paper currency. By knowing what to look for, you can make informed decisions about your collection.