By John Reese, Validea

Known as the Father of Value Investing, Benjamin Graham inspired Mario Gabelli, John Neff, John Templeton and, most famously, Warren Buffett. All were Graham disciples who went on to their own stock market greatness.

Born in England in 1894, Graham built his reputation -- and fortune -- by using an extremely conservative, low-risk approach to investing. To Graham, an investment wasn't something that could be turned into quick, easy profits. Anything that offers "easy" rewards also comes with substantial risk -- and Graham abhorred risk.

In terms of specifics, Graham's approach limited risk in a number of ways, and my Graham-based model lays out several of those methods.

For example, one key criterion is that a company's current ratio -- that is, the ratio of its current assets to its current liabilities -- is at least two, showing that the firm is in good financial shape.

The approach also targets financially sound companies by requiring that long-term debt not exceed net current assets.

Two other criteria the Graham method uses to find low-risk plays: the price-to-earnings (P/E) ratio and the price-to-book (P/B) ratio.

Graham wanted P/E ratios to be no greater than 15 (and, as another signal of his conservative style, he looked not only at trailing 12-month earnings but also at three-year average earnings, to ensure that one-year anomalies didn't skew the P/E ratio).

For the P/B ratio, he used a more unusual standard: He believed that the P/E ratio multiplied by the P/B ratio should be no greater than 22.

My Graham-inspired strategy tends to find bargains across a variety of areas of the market. Here are the current holdings of the 10-stock Graham portfolio:

Forest Laboratories (FRX)
Curtiss-Wright (CW)
Helmerich & Payne (HP)
NTT DoCoMo (DCM)
United Stationers (USTR)
GameStop (GME)
General Dynamics (GD)
USANA Health Sciences (USNA)
DeVry (DV)
Walgreen (WAG)

Since I started tracking my Guru Strategies more than nine years ago, the performance of my Graham-based model has been rather remarkable. Even though the strategy Graham outlined is now more than 60 years old, it just keeps on working.

Through July 17, the 10-stock Graham-based portfolio was up 179.2% since its July 2003 inception, making it my second-best performer. That's a 12.1% annualized return in a period in which the S&P 500 has gained just 3.5% per year.

The model's strict balance sheet criteria helped it avoid big losers in 2008, as the portfolio lost less than half of what the broader market lost, and it rebounded big in 2009 and 2010, gaining 31.4% in '09 and 22.6% in '10.

In 2011, it had its worst year, however, falling 19.0% while the broader market was flat. It's rebounded nicely in 2012, though, having risen 10.7% vs. 8.4% for the S&P, indicating that last year was an aberration.

It's also worth noting that the 20-stock Graham-based portfolio I track has been even better. In fact, it's the best performer of any of my 10- or 20-stock portfolios, having returned 259.7% since its July 2003 inception -- that's 15.3% per year.

The Graham portfolios' long-term results are a great demonstration of how successful stock investing doesn't need to be incredibly complex or cutting-edge.

You don't need fancy theories or gimmicks; you just need to focus on good companies whose stocks are selling at good values. Do that, and you should produce some strong results of your own.

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