Spearman Rank Correlation Coefficient

Just to confirm…

CFA Vol. 1 p. 624

When ranking observations, the highest value gets rank 1, regardless of what the rank means.

In this example, a higher Sharpe ratio is the ‘best’ result, so it should receive rank 1. However, a higher Expense ratio is a bad thing and intuitvely I gave the highest observation the lowest rank. This seems to be incorrect.

So, we arrange the data purely in ascending order, right?

Thanks

Mark

Yep, data to be arranged in an ascending order irrespective of its significance in real-life.