The different kinds of fades

There's different types of fades you can do using the compositor (also applies to 2.79)

how blender's color pipeline works is that it works out the raw pixel values for the render first, then performs operations on it, before flattening it out to make the final image.

assume our displays have lights that go from 0.0 (off) to 1.0 (brightest) with anything in between. the key here is that the "raw" rendered pixel values actually go BEYOND 1.0 (or rather, beyond 255), it's just that blender flattens it out to a maximum of 1.0 before it gets sent to our displays. obviously, our displays can't go brighter than 1.0 here.

this results in two kinds of fades:

"real" fade: this operates directly on the "raw", rendered data. when it's fading it reveals the brighter parts that were clipped out due to the flattening thing. this is basically what you see in movies. i think they call this fading on "scene-referred values" or something
"amateur" fade: this is what we do when importing renders into other programs, especially when our renders are avi, mp4, png etc. (but not .exr). the data is already "flattened", and the app doesn't know there supposed to be anything in the bright parts so it just does its thing. i think it's called fading on "broken-ass shit display-referred values"

you can actually simulate the flattening by clicking on "Clamp Result" (or just "Clamp" in 2.79), if you really want to emulate the effect without ever leaving blender