How coins are graded by two of the top coin grading services
The NGC Grading Process
NGC has a very comprehensive guide to what they call their 'Details Grading Process' so I highlighted a couple of noteworthy sections from what I've read, and even included a downloadable .pdf of their complete 17 page detailed guide.
Click here to download itOf the many thousands of collectible coins in the hands of dealers and numismatists, some bear surface conditions that preclude NGC’s graders from arriving at a recognized numeric grade. For these coins, they use an NGC Details Grading Process. Each coin receives a grade that relates to the amount of wear present due to metal loss during circulation.
Following the Details Grade will be a description of the noteworthy surface condition. In rare instances, there may be more than one surface condition listed. Many problematic surface conditions occur naturally, but more often than not, they are the result of mishandling over the years, whether deliberate or inadvertent. Once identified, the surface conditions are noted with descriptive terms.
In the past, coins with problematic surface conditions were given Details Grades and were encapsulated by NGC’s affiliated conservation company, Numismatic Conservation Services (NCS). NCS no longer performs grading and encapsulation, and all coins not eligible for numeric grading will now be graded and encapsulated by NGC under its Details Grading service. Coins already encapsulated by NCS may be resubmitted to NGC for Details Grading at just the nominal ReHolder fee. Submitters will not have to pay a ReGrade fee for NCS-holdered coins to be encapsulated under NGC’s Details Grading service.
How NGC Grades Their Coins
Each coin receives a Details Grade that accords with the amount of detail remaining on the coin. Coins lose detail as the result of wear, which is metal loss that occurs during circulation. For that reason, Details Grades are sometimes referred to as “wear grades.”
The value of a Details Grade coin is never determined by its grade alone. The severity and location of the detrimental surface condition is often just as important as the Details Grade when determining value. A Details Grade can give a strong indication of what a coin may look like and is a fundamental component of the equation when determining both condition and value. The following describes the Details Grades that are assigned by NGC.
UNC DETAILS (Uncirculated)
A coin that shows no wear or evidence of circulation.AU DETAILS (About Uncirculated)
Traces of light wear are evident on the high points of the coin’s design.XF DETAILS (Extremely Fine)
Design features are well defined, although light wear is evident throughout.VF DETAILS (Very Fine)
Major details of the coin are clear although wear is evident; the high points show moderate wear.F DETAILS (Fine)
Moderate wear on many elements with heavy wear on high points. The major design elements remain visible.VG DETAILS (Very Good)
Heavy wear flattens design elements, although major features are clearly outlined.G DETAILS (Good)
Design details are flat and visible in outline. Some portions of the design may be faint.AG DETAILS (About Good)
Design details are flat and appear in outline. Portions of the rim are lost to wear.FA DETAILS (Fair)
Coin is identifiable, design is flat and visible in outline, and rim is essentially indistinguishable from coin fields.PR DETAILS (Poor)
Heavily worn; only basal detail remains.
Click Here For The PCGS Grading Process