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Optical effects are those film effects that are created entirely through an optical process using film, light, shadow, lenses and/or chemical processes. Examples are film titles, fades, dissolves, wipes, blow ups, skip frames, bluescreen, compositing, double exposures, zooms/pans and many more special effects.
All of these things can now be done electronically and/or digitally, but they were originally created in an analog environment.
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