Try a Dynavector 10x latest version. High output 'coil would work well in your system. IMHO.
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I agree with Ivanj's comment that a high output MC might work well for you but, in your price range, you're going to be looking at MM. If you could move up a bit, alot of folks here on 'Gon have been raving about the Denon 103. If you must stick with your budget, the Grado Prestige series might be worth investigating.
The 707 is a pretty light arm, as I remember. Before you finalize anything, check back on this forum for other's experience with the combo you are leaning toward.
Gumby, hi. The 707 would like a medium to high compliance cartridge. The lower compliance ones will be too much for the bearings of the ol' Grace. I think the Dynavector mentioned above might be good if you like the Dynavector Sound. The Goldrings are also good. If you want to go higher end, just make sure it is not too stiff. I have had some experience with the 707 and a stiff cartridge will definitely shake the bearings loose. If you want to go low compliance, a Rega RB-300 arm will definitely take you there, as those bearings are head and shoulders above the Grace. I personally believe that the arm will be more of a sonic improvement than the cartridge, and if you are going to buy a cartridge that will be with you for some time, it would be good to buy a matched set of tonearm/cartridge as a combined upgrade. If you could get an Ittok, it would be better yet. Either of these arms with a lower priced cartridge will give better results than the Grace 707 with a high priced cartridge. Please consider this idea. I have had a Linn/Ittok/Karma package in the past and it was terrific. I have also worked for years in a Linn/Naim dealer and heard hundreds of demos with different combinations. The arm is definitely more critical to the system than the cartridge. Just trying to help.
Gumby- Seems like there is a fairly good market for the 707 if you are looking to sell. You might be able to fetch close to a couple hundred and then turn around and find a used RB-250 with the OL mods plus another armboard for not much more. Heck, you probably wouldn't mind the table being down for a month or so while you're in-between arms- you're going to be on the water for the next few months anyway!
BTW- Are you a rag-hauler or stink-boater?
Traded the sloop for a small and quick bowrider 7 years ago. Kids were too young to appreciate it.
Came into a semi home-made houseboat two years ago.
When the youngest (14) gets to college age, my wife and I might just get another sailboat and drop out of society :>)
(There is nothing like the sound of the ropes hitting the masts at night.....ahhhhhhhhh)
I wonder, How do you use a turntable on a sailboat?? ;>)