I should not give away one of my secrets, but believe it or not brown permanent markers work really well. I apply them and then quickly rub in with my finger until it blends.
M1 Carbines also have what is perhaps a "thousand Dollar' chip, which develops along the side of the stock's recoil lug.
It is very typical to find a chip missing, usually from the left side.
I used exactly the method described above but when it came time to match wood the permanent marker has gotten through many a situation.
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