SmartRisk does not use the benchmark/asset class. It uses the information of the ticker symbol / individual holding. In the great majority of the cases, this allows for a more precise estimation of portfolio risk. You are right that there are cases where the advisor is justified to feel that this would not be the best method, for example, for a mutual fund with a very short trading history. In these cases, we recommend that the user uses his/her own discretion. We made it relatively easy to replace a holding with another holding with similar risk characteristics. For example, if there was a brand-new ETF that tracks the SP500, you could consider replacing that holding with say SPY.
Also, if there are un-recognized symbols (e.g., non-traded assets, or individual bonds), SmartRisk allows the use of ‘Smart Symbols’, which make for an easy substitution in the clients’ portfolios, and are designed to give a better view of the risk. We feel this should get you very close to a great approximation, without sacrificing quality or having to produce an incomplete analysis.