A portfolio of firms with below-median market capitalizations (Small) has a monthly return that is 0.23% higher than a portfolio of firms with above-median market capitalizations (Big). Optimers main competitor invests by short-selling the Big portfolio and using the proceeds to buy the Small portfolio, earning the monthly return of 0.23%. Optimer conducts its own propriety stock return research. It sorts firms by both size and BE/ME, and calculates the following historical monthly returns: High Medium Low Small 1.26% 1.03% 0.38% Big 1.1% 0.68% 0.18% Explain how Optimer can use this information to outperform its competitor, and how much higher its monthly return will be. Is this extra return a premium for taking on more risk exposure, or does it represent alpha