PSA


Introduction

▪ PSA dominates so much of the sports card grading conversation that it deserves its own section to discuss its policies, grading, price point, resale and other PSA accusations. In this article we will talk all about PSA as a company, including many recent accusations and problems.

PSA Resale

The reason why PSA is such a large portion of the sports grading world is the quantity of cards it grades combined with its absolute dominance when it comes to resale. PSA 10's are no more uncommon than BGS 9.5 but command a much larger resale price. The difference is so great that many people do not even consider sending their cards elswhere because the return is so much smaller for any other company, even when PSA charges more for grading. We have done some analysis on if PSA is actually worth it here, where the conclusions show that it shouldn't be as clearlly dominant as it is. However, if you were to go to a reddit trading card forum, recommendations will be to send cards to PSA all day.

The real question is, why does PSA have the highest resale valueh? Do they deserve it? I firmly believe the answer is NO. In fact, I don't even think PSA should be in the discussion of top grading companies at all. This sentiment doesn't stop me from sending cards into PSA if I think it will return the most money. I just dont think they should.

However what I think and reality are not always the same. The fact of the matter is PSA 10's do sell for a lot and I just don't have an answer for it. They are an older company and first mover advantage does mean quite a bit in anly situation. They also have great name and brand recognition. They are also the only company that historically have freely given out a 10 grade. This last point is I think the big reason. People like seeing 10's more than 9.5's, even if they are in the exact same condition. It has a psychological effect that makes people think it is perfect when in reality it is just a lack of grading precision that PSA has decided not to give.

Pricing

PSA's pricing model is the strangest in the business. It is no more difficult to grade any piece of cardboard compared to any other. However, PSA's pricing is based on the value of the card. The more expensive the card, the more expensive it is to get the card graded. However, perhaps the strangest and borderline unethical thing that PSA does it is charges not based on the raw value of the card, but the expected value of the card. For example, a raw Lebron James #221 rookie sells for $400. A PSA version 9 Sells for $780 and a PSA 10 sells for $3000. PSA has a price tier costing $150 dollars if the card has an expected value less than $2499. It has a $300 price if the card is between $2499 and $4999. Now, you have to pregrade your card, essentially telling PSA what you think your card will grade at. If you think it will grade a 9, they will charge $150. If you think it will grade a 10 then they will charge $300. It gets strange in that if the card DOES grade a 10 they will charge you on the back end for the $300 dollar service. However, if you pay for the $300 service and it gets a 9, they will still charge you for the $300 service!

This pricing model is in direct opposition to unbiased, fair and accurate grading. PSA is grading the card, but also has a business interest to charge you as much as possible, plus charge you as much as possible in the future. If you pay for the $300 service, they don't want to make you angry and lose a customer so it could very well be that in some cases, they bump a sub-tier quality card up a bit just to make you happy and "get what you paid for". On the other hand, if you only paid for a $150 service, this may depress scores as you only think the card is a 9. You paid for a 9, they may very well just give you a 9. Given the business interest that PSA has to you, as a customer and as a future customer, there are financial incentives for them to grade in a biased, inaccurate way. They are essentially playing a pay to win system, which in its core may not be unethical, but it has the potential to impact grading.

PSA Difficulty Increase

In 2020, PSA shut itself down for new submissions, which caused a major impact on thhe sports card grading world. However, the bigger news went under the radar since it went unannounced. Over the next few months as people recieved their backlogged orders, they began to complain that they weren't getting as many 10's back as they previously did. Their only conclusion was that PSA had gotten harder. The stories are common about people who would submit 100 card a month with 80% return as 10's to suddenly submitting the same amount but the number of 10's had decreased to 30% or 50%. During this period, PSA never changed its grading rubric so their standard seemed to have remained the same but rumors said something was different.

I decided I wanted to put a bit of effort into figuring out what was going on at PSA. In early 2021, PSA shut down all of its grading services in order to catch up on backlog. At this same time I took a snapshot of several of the pages of their pop report for historical comparisons. Now, given that the rumors of their grading getting tougher surfaced in mid 2020, the snapshots I took would have some of the more rigid grading standards but mostly it was from the supposed pre-change. Now, anyone can look up the pop report for any PSA card. It is public information. However, since I had a snapshot at a given point in time, any cards added to the pop report since then would be graded under the new, different grading standards. If there were 1000 10's of a given card and 1000 9's when I took my pictures, and currently there are 1500 9's and 1200 10's, it means that there have been 500 9's and 200 10's added in the past year. Essentially we can calculate a 2021 population report for cards under the new system. We can then compare the ratio of 9's to 10's. If the ratio of 9's to 10's has changed, then this is pretty strong evidence that they are giving out fewer 10's. For example, if there were 100 9's and 100 10's of a given card there is a ratio of 1:1. However, if the 2021 pop report shows that 50 9's have been added and only 20 10's, then the 2021 ratio is 5:2. When previously 50% of submissions were 10's and now only 28% are 10's, thing have gotten tougher. So lets look at some actual numbers for actual cards.

Lets begin with one of the most graded cards in history: 1990 Fleer Michael Jordan #26. Back in early 2021, this card had been graded a total of 19394 times by PSA. Of these, 10324 were a 9 and 3553 were a 10. Meaning out of these higher grades, there was a ratio of 2.9:1 9's:10's ratio, or about 74% were 9's, 26% were 10's. Currently, The card has been graded 30,083 times, so it has been graded 10689 times this year. There have been 4980 9's and 929 10's added to the report, making a ratio of 5.36:1 or 84% 9's, 16% 10's. A significant increase. If you were to submit 10 of this card to PSA, previously you would expect 2 10's and now you would only be getting MAYBE 1. Before the shutdown 10's accounted for 18% of all Fleer #26 submitted. Since the shutdown 10's have accounted for just 8% of all submitted. That is a drop of 50%!

Instead of just looking at one specific card, lets look at an entire set: the 2016 Prizm set. Prior to 2021 there were 8020 2016 prizm cards in the pop report. There were 2483 9's and 5214 10's. Tens made up 65% of all 2016 prizm cards submitted. The ratio of 9's to 10's was .47:1. In 2021, 12815 cards have been added to the pop report, 3093 9's and 3335 10's. Meaning there is almost a 1:1 ratio of 9's to 10's in 2021. Instead of 10's making up 65% of submissions, they only make up 26% of new submissions, a MASSIVE drop. Instead of getting 6-7 10's in a 10 card submission you are only getting 2-3. This basic analysis can be conducted at any level on the PSA pop report and the results are almost always consistent.

The only situation where this is not the case are sets that came out AFTER the middle of 2020. For example, lets look at the 2019 Kobe Bryant Prizm Silver #8, released in December of 2019. After preparing this card, getting it shipped to PSA and actually getting graded, it was probably closer to mid 2020 before it started to appear with any frequency. Pre 2021, the 9 to 10 ratio of this card was 2.35:1. In 2021 the ratio is just 2.56:1. Nothing drastic like we see in cards from earlier sets. This makes me strongly believe that the rumors were true. Sometime in mid to late 2021, the standard for PSA changed to become much stricter.

It happened, PSA has increased its grading standards. However, how big of a deal is this really? The answer is it is a very VERY big deal. There is a reason PSA didn't make it public knowledge it was increasing its grading standards, becuase a PSA 10 prior to 2021 is not the same quality of card as a PSA 10 after 2020. Think about that. Their old 10's are really just 9's but still command 10 prices. Every PSA graded card prior to 2021 has questionable grades. It is basically them saying that they had really weak, low standards for grading and they wanted to fix it. If you read these previous articles, you will know that you cannot be both unreliable and accurate. The fact that their standards have changed means they are unreliable which means any card graded before 2021 is inaccurate.

Why would PSA do this? I don't know exactly what goes on at the top end of the PSA chain. However, it probably had to do with the frequency of 10's they were giving out. When every order returned had 80% tens, it becomes hard to believe that 10's are all that high of quality. Its like any scam grading company that only gives out 10's, and this is what was happening at PSA for modern sets. All cards were getting 10's (or upwards of 80%). When a 10 is a dime a dozen, a 10 doesn't have any value and they needed to turn change things for the longterm financial viability of the company, before a PSA 10 became a walking meme. So they increased their standards.

What impact does this have on us as collectors? It actually has quite a bit. Over the long run, it is likely people will be able to distinguish between a pre2021 PSA 10 and a post 2021 PSA 10, meaning the previous ones will lose value. This will be exasterbated once AI grading becomes more popular and you can just point a high quality camera at a card in person and get a meaningful grade. Older PSA 10's won't hold up to such quick scrutiny and feedback. Holding onto older PSA graded cards may not be the best option for long term resale. In the short run it impacts where we should send cards to be graded. If you have read the advanced grading section, it highlights that PSA may not be the best choice for cards anymore. Back when they gave out 10's like candy, sending cards to be graded by PSA was like printing money. But now they have tightened up standards it is likely other companies are better. In fact, PSA may be the absolute worst place to send cards to to be graded when considering resale value.

Population Control

Population control is when a grading company artificially controls the number of cards graded, typically to restrict the number of perfect grades. Technically if Panini actually got its quality control together and printed a perfect set, no print lines, perfect centering and perfect cuts and nothing was damaged by shipping or users, every single card SHOULD get a 10. However, it is likely they all wouldn't as there would be population control inaccurately reducing some cards grades.

Historically, there have also been rumors that PSA has population control on more popular players. Lets examine these more closely by looking at one indivual card. In previous articles we have used the Topps Lebron James #221 rookie as an example and we are going to return there. Prior to 2021, this card had been submitted to PSA 8192 times, with 3416 9's and 1854 10s. Meaning a ratio of 1.84:1. 10's were 22% of the total population. In 2021 this card was graded an additional 3527 times, with 1521 9's added to the population report and only 190 PSA 10's added. In 2021, this is a ratio of 8:1 and was only 5% of the population during this period! Previously when you submitted this 10 of this card you could expect 2, maybe 3 10's. Now you are lucky to get just 1. The population control applied to this card is staggering, and is most likely done to protect the amount of 10's in circulation. What it really means is that previous 10's in worse condition are getting propped up by cutting the amount of 10's while current 9's (which are equivilent to prior 10's on condition) are getting shafted with a lower grade. It is crazy to think that this card had a 9:10 ratio of 1.84 to 1 and currently has a 9 to 10 ratio of 8:1.

What is just as shocking is if we review the rest of this set. Prior to 2021 this set (excluding the Lebron James card) had a 9:10 ratio of just 1.69:1. In fact, the Lebron James card itself was just over this at 1.84:1. After the increase in grading standards this set sits at a ratio of 3.42:1. What we see here is an interaction. It became harder for all cards to get a 10. But for star players like Lebron James, the grading criteria became even tougher.

In the previous section we talked about the 1990 Fleer Jordan #26 and its pre-2021 9 to 10 ratio of 2.9:1. After 2021 this increased to 5.36:1. If we look at the rest of the set we can see the same increase in difficulty and the same population control occuring for MJ. Prior to 2021 the set (excluing the MJ card) had a ratio of .67 to 1. Far different than MJ's 2.67 to 1. Post 2021 we see the set has increased to 1:1, which is even more different than the increase in MJ's #26 of 2.9:1 -> 5.37:1. What we can see is PSA increased its standards more for star players in order to control population. This is called systematic error and introduces systematic innaccuracies. When you are lowering a card score which should be a 10 to a 9 just because it is Lebron James, somethign is very, VERY bad.

Conclusion

If you have read this, my conclusion is simple. PSA simply cannot be trusted as their grades are influenced by business decisions and NOT by the actual condition of the card. I personally do not trust PSA grades because of this and generally recommend almost any other grader out there.