The term "uncirculated coin" refers to the condition of a coin that indicates that it has never circulated in the regular money supply in the economy. In other words, the coin shows no signs of wear on any of its surfaces. Since most modern coins are mass-produced in large quantities, it is common that the coin may have small nicks and scrapes on its surface from the production process and transported in bags and bins.
These minor imperfections are not from the coin circulating in commerce, and hence the coin is still considered an uncirculated coin.
Numismatists grade uncirculated coins by taking into account the concentration and quantity of these minor imperfections. Coin collectors grade uncirculated coins using a scale that ranges from MS-60 (a lot of marks and imperfections) to MS-70 (a perfect coin with no marks). Numismatists grade world coins using adjectives to describe the grade such as Uncirculated (considerable amount of marks), Brilliant Uncirculated (just a few minor marks), and Gem Brilliant Uncirculated (no marks are visible to the naked eye).
How to Identify an Uncirculated Coin
When a coin first comes off the coining press, it exhibits a luster that can only be produced by the minting process. If you held a coin under a single light source and tilted from side to side, and top to bottom, you will notice that the light will dance around the surface of the coin.
This movement of light on the surface of the coin is known as the cartwheel effect.
If the coin does not exhibit the "cartwheel effect," it has been circulated and cannot be classified as uncirculated. Next, look at the highest points of the design. If the cartwheel effect is evident on the fields of the coin but not on the highest points of the design, numismatists would consider it an about uncirculated.
The only way for a coin to be classified as uncirculated is if there is no evidence of wear anywhere on the coin. In other words, the luster is clear and complete across the entire surface of the coin.
Effect on Value
Just like any collectible item, be it classic cars or antique dolls, the better the condition of the item the more it will be worth. This effect on value takes into consideration the basic economic laws of supply and demand. Mints around the world make many modern coins by the millions, if not billions. The supply is enormous, and the chances of a coin collector finding an uncirculated coin are fairly certain. Coin collectors did not save a lot of coins from the 1800s and before, and hence the supply is limited.
Additionally, just because very few examples of a particular coin exist may not make it exceedingly valuable. This is where demand comes into play. Many people collect Lincoln pennies, and hence the demand for them is quite steep. On the other hand, very few people collect the United States three-cent coins. Therefore, a low supply of a particular date of three cent coins may not make it exceedingly valuable because not many people are seeking to buy it. In other words, competition to purchase that particular coin is low and so will be the price.
Acquiring Uncirculated Coins for Your Coin Collection
There are many different ways for you to acquire uncirculated coins for your collection. Uncirculated modern United States coins, such as the Lincoln penny or the Jefferson nickel, can be collected directly from circulation or rolls of coins from your local bank. Some modern coins from the Denver mint are scarce on the East Coast. Conversely, coins from the Philadelphia mint are scarce on the West Coast. Therefore, you may have to visit your local coin store or purchase uncirculated modern United States coins from an online coin dealer.
Purchasing classic uncirculated United States coins can be more of a challenge and a strain on your coin collecting budget. You will have to purchase these coins from a coin dealer or online auction. Depending on the coin type and date, uncirculated specimens of classic United States coins can range from a few dollars to a few hundred thousand dollars.
Purchasing uncirculated world coins can be accomplished through a visit to your local coin dealer or online transactions. Buying world coins on eBay can be an adventure in itself. There are so many international sellers that you can virtually purchase any modern world coin at a reasonable price.