There are three easy ways to resize an overlay:
Drag from any edge or corner to adjust the size.
You can also click the overlay and then choose Overlay Bigger or Overlay Smaller (⌘+ and ⌘-) from the Edit menu.
If you’re using a mouse, you can put your cursor over an Overlay and scroll to change the size. If you’re using a trackpad, use the “pinch” or “spread” zooming gestures.
Overlays can also be cropped.