To determine the most accurate approximation for the component Value at Risk (VaR) of a financial asset, consider the following background information:

Value at Risk (VaR) is a widely used risk measure that estimates the potential loss in value of a portfolio, asset, or investment over a defined period for a given confidence interval. It provides a probabilistic indication of the maximum expected loss over a specified time horizon under normal market conditions. Component VaR, specifically, quantifies the contribution of each individual asset within a portfolio to the overall VaR.

Given this context, what is the most precise method for calculating the component VaR of an individual financial asset within a diversified portfolio?