Such a formula has been worked out, specifying a 50-50 stock-bond ratio at the median, with a 5 percent reduction in stocks at every 10 percent rise above the median and a 5 percent increase in stocks at every 10 percent drop below the median.8 Maximum percentage of stocks is set at 65, and the minimum at 35. Excellent results were shown in the test, which covered the 1926-50 period. Value of the original portfolio nearly doubled, despite the fact that the Dow-Jones Industrial Average increased only about 40 percent. Although Mr. Graham states the calculations of the central value from 1881 to 1936 "fall quite consistently within the actual price fluctuations during the period," the method has not worked so well recently.

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