Risk sizing with multiple Asian equities vs. single index

Still trying to get my head around proper risk sizing when running a basket of individual Asian equities (say $KC, $HKE, $SGX) versus just trading a single index like Nikkei. Seems like correlations within the basket might reduce overall volatility, but individual stock swings can be huge. Do most of you calculate total portfolio risk by aggregating individual position risks, or do you have a different method when dealing with regional baskets?