Abstract: A method and apparatus is provided for characterizing magnetic coating compositions that contain magnetic particles dispersed in a solvent resin matrix. The coating composition, as it passes through a tube, is subjected to an alternating magnetic field and perpendicular thereto a constant magnetic field of appropriate field strength and duration. Via a measuring coil surrounding the tube the induced signal in the composition is monitored and the degree of dispersion, is measured by measuring the magnetic susceptibility of the coating material. By applying a constant magnetic field the degree of dispersion cna be changed at least for a certain time. The method and apparatus of the present invention can be incorporated into a coating apparatus to monitor and improve the magnetic characteristics of the coating material being applied to a substrate.