Could Someone Please Explain How This Simile Works? - "Muted by mist, like those of a faded water-colour."?

This is comparing the colors to the colors in a water-colour painting. Water color paints tend to run together and fade into each other, creating very soft, indistinct lines. I think this simile is saying that since the bank was covered by mist, everything was very blurry and indistinct, similar to a watercolor painting.