Video lanes stack, lane order is draw order, and any clip can become a floating picture-in-picture overlay. This is how to build one.
Add a video lane Click the + beside the video lane headers to add a lane on top. Whatever sits on a higher lane draws over the lanes beneath.
Make a clip an overlay Select the clip and open Transform → Layout, then choose Make overlay (PiP). The clip shrinks to a floating box that keeps its true aspect ratio.
Place it on the canvas Open Edit layout to get drag handles on the preview: move it anywhere, resize from the corners, or snap to a corner preset. Size and position sliders live in the same editor.
Style the box Opacity, rounded corners (Mask → Rounded) and shape crops give the overlay a polished look. Crop reframes what is inside the box without distorting it.
Animate it (optional) Keyframes on position, scale and opacity turn a static overlay into a fly-in. The keyframes guide covers the detail.
Tips
A portrait clip stays portrait: overlay boxes hug the media, so nothing is stretched into a rectangle.
Timeline gaps on upper lanes are transparent: the layers (or project background color) beneath show through.
Combine an overlay with chroma key for a floating cut-out subject.
For stickers, logos and watermarks, use the + on the overlay track. Image overlays sit above every video lane, and animated GIFs keep looping in the export.