Let's say you found a bundle of cash one year ago and decided to try out a theory of some local stock brokers that Washington area businesses deserve your investment.

For your hypothetical portfolio, assume half the cash was invested in securities of a broad range of New York Stock Exchange companies, with the balance used to buy equity in D.C. area firms.

By year's end, you would have discovered that the theory was correct, at least in 1977. As of Friday night, when the stock markets closed for a three-day New Year's holiday weekend, the Dow Jones average of 30 industrial blue chip corporations was down 17.3 per cent for the year, to 831.17.

An even broader measure of Big Board issues, the 500-stock Standard & Poor's index, gave up 11.6 per cent to close out 1977 at 95.02.

But for the 30 stocks of Washington companies that comprise the Johnston, Lemon index, there was a gain in 1977 of 8.5 per cent to 80.372. And several local stocks not included in the index did well, too.

Overall, last year was a good one for so-called secondary issues, stocks traded over the counter or on the American Stock Exchange. Because the index of area stocks, compiled regularly by the regional securities firm of Johnston, Lemon & Co., Inc., includes a mixture of Big Board, Amex and OTC issues, it benefited from general interest in companies not listed on the New York Exchange.

Johnston, Lemon's local 30 stocks also managed to top the overall OTC gain of 7.3 per cent (the National Association of Securities Dealers index of OTC stocks closed the year at 105.5 up from 97.88), but the stock market champion for overall price increases in 1977 was the American Stock Exchange, whose the price index rose 16.4 per cent in the year to close at 127.89.

The Washington company began compiling a local stock index in 1974, using 1970 and 1971 prices for a base period equal to 100 on its index. In is an unweighted composite index of firms that range from utilities to retailers and insurance firms, broadly designed to reflect the types of business that are active in this area.

Although local stocks outperformed most national market measures last year, they also declined more rapidly during the recent recession. Currently, the local stock index is at an all-time high: it has been on a long-term growth trend since May when it hit a yearly low point of about 70 points.

According to Johnston, Lemon analyst Henley Custic Hoge IV, the key, items on investors' mind last year were dividends and earnings.In general, those firms that reported higher profits and boosted their dividends also attracted investor interest that pushed stock prices higher.

He predicted that the new year also will be a good one for businesses here, with banks doing much better and retailers benefiting from improved consumer confidence and big-ticket expenditures and slightly lower rates of interest, inflation and unemployment. Hoge said the Dow average of 30 industrials probably will "test" the 800 level again before resuming growth. But growth will come for the Big Board stocks and the Dow may top 900 during the year, he stated.

Secondary issues, in general, won't advance as much in 1978 as they did last year, he added.

As for specific issues in the Johnston, Lemon index, the largest percentage gain was recorded by International Bank, a diversified financial services company that is rebounding from a traumatic period during which a Barbados was closed and its ties with a bank holding company were severed. IB gained 60 per cent to close at $7 a share.

Other large percentage increases were: Washington Post Co., up 43 per cent to $35.75; Financial General Bank-shares, up 39.7 per cent to $11.25; United Services Life Insurance, up 37.5 per cent to $13.75; Macke Co., up 32.7 per cent to $8.625; and Quality Inns International, up 31.25 per cent to $2.625.

The Post Co, was the biggest dollar gainer, up from $25 to $35.75. All of these firms have been reporting higher profits, in some cases representing strong rebounds from the recession era.

On the down side, Dart Drug declined 27 per cent to $5.75, reflecting a general decline in retail drug stocks in a highly competitive marketplace; Allegheny Airlines fell 25 per cent to $3.75 and Southern Railway declined 19 per cent to $50.25.

The rail firm also was the biggest dollar loser, off from $62 a year ago. The airline suffered heavy losses during the severe winter early in 1977, but traffic has been up sharply in recent months. Southern also was affected by the winter but has been posting higher earnings; the outlook for rail firms is uncertain because contracts expired this weekend with labor unions and a strike is possible later this year.

Several stocks not in the Johnston, Lemon index that did well last year were Hechinger Co., which is expanding its retail base throughout the midatlantic region, up 57.1 per cent to $6.875; Fairchild Industries, up 71.4 per cent to $16.50 on the basis of firms government airplane contracts; and Avemco, up 16.1 per cent to $4.50, based on record earnings, two dividend boosts and increased sales for general aviation, which the Bethesda firm insures.

Retail issues listed in the Johnston, Lemon inxdex were mixed: Garfinckel, Brooks Brothers, Miller & Rhoads rose 24.8 per cent to $18.875 on higher profits and acquisitions; Woodward & Lothrop fell 8 per cent to $26, with modest sales increases in a more competitive department store market; Drug Fair fell 9 per cent to $10.125; Giant Food rose less than 50 cents a share to $18.25; and Peoples Drug was down 4.2 per cent to $8.50.

Among other stocks in the index, American Security Corp, rose 2.8 per cent to $46.25; Communications Satellite was off 6.7 per cent to $29.75; Criterion Insurance gained 4.4 per cent to $17.75; Federal National Mortgage gave up 13.1 per cent to $14.875; First Virginia Bankshares was down 11.9 per cent to $6.50, and Government Employees Insurance Co. gained 14 per cent to $8.125.

Also, Government Employees Life fell 16.9 per cent to $12.25; Marriott declined 14.1 per cent to $11.625 (but began to rebound after declaring an initial cash payout); Martin Marietta declined 6.3 per cent to $24.125; Mortgage Investors of Washington was unchanged at $2.625; Potomac Electric Power was up 9.6 per cent to $15.75; Riggs Bank was up 2.4 per cent to $32.50; B.F. Saul Trust rose 6.1 per cent to $4.375; Suburban Bancorporation fell 11.3 per cent to $16.75; Washington Gas Light added 11.5 per cent to $24.25 and Washington Real Estate Investment Trust rose 1.6 per cent to $24.125.