Before I begin, let me just say that this is all just my personal opinion. The use of the term "Holy Grail is completely subjective. Different collectors use the term for different situations, and that is okay.
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Well, the story goes that the Holy Grail was/is a cup that Jesus drank out of at the last supper (the night before he was killed). It is one of the most highly-searched-for items in history/mythology.
So the term "Holy Grail", in the world of pin collecting, is meant to represent a pin that is very special, and that you are searching for very hard, and is not easy to come by.
The term CAN also refer to the rareity of the pin, as there was only ONE cup from which Jesus drank. Which is why it is so very hard to find (if you believe it exists at all). Although many collectors, such as myself, do not require a low LE size in order to assign the term "Holy Grail" to a pin.
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This pin was my Holy Grail for two years:
Pin 69046: DisneyShopping.com - 3-Pc. Pixar Shorts Pin Set For The Birds Only
That bird there in the middle of the pin is my favorite Pixar character of all time. (You will note that I have a picture of him as my DPF avatar.)
I searched for this pin for about two years before I finally found it for sale on ebay. It was around $20, if I remember correctly, so it wasn't a very pricey pin overall. But to me it is priceless. I would've paid a LOT more for it, if that had been the asking price. But the seller didn't know that he had someone's grail on his hands.
This is exactly why we say that value is subjective. It varies, depending on what any given buyer is willing to pay for it at that time. And many times, this is based on an emotional attachment.
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Then there is this pin:
Pin 55819: DisneyShopping.com - Pixar Group (Jumbo)
This pin was never my Holy Grail. I know many people would have thought that it would be, because it is so rare and valueable. And I DID really want the pin. I knew that as a Pixar collector, it would be the centerpiece of my collection, because it has over 20 Pixar characters from 7 different Pixar movies. I just never thought of it as a grail. I did obtain the pin. I traded two legs and an arm for it, which was fair market value, and I'm glad I did. I knew that my collection would always be incomplete without it.
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Another thing you should know about the term "Holy Grail" is that some people use it more liberally than others. I personally have only ever assigned the term to two pins: the "For the Birds" pin which I listed above, and my current HG. Other than those two pins, if there is a pin that I want desperately, I refer to it as a "Most Wanted". I keep a pinpics group of my "Most Wanteds", which lists a couple of pins for each Pixar movie. This way, when I do use the term "Holy Grail", people know that I really mean it. Note that it includes the word "holy", which in my opinion, means that it is not a term to be just thrown around on whatever's hot right now.