Highlights sorts annotations chronologically by default using their position in the text and placement on the page. Color categories allows for another level of categorization.
1. Open Preferences, go to the Color Categories pane:
2. Enable Sort annotations by color
The annotations in your notes are now grouped by color and sorted using the order shown here.
3. Customize and reorder the color categories
You can change the order of the colors by dragging the items around. You can also give each color category a name instead of the color description. Just click on the text and enter your own name: