I cannot point to a good manual (difficult to define whats good) but I will try to get you a start here. The logic is same as KSDS VSAM index logic.
Ok, So now you have a Db2 table without any index. You define an index now and do a Build index (possibly a reorg to get a correct sequence). The index values sequence will have the same sequence to DB2 rows. Now if you try to insert a row whose index falls somewhere in between , Db2 will try to insert the row in the corresponding location by utilizing the freespace in a page.