`helmfile diff` returns "Release was not present in Helm. Diff will show entire contents as new."

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    Release was not present in Helm.  Diff will show entire contents as new.

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If I am interpreting this right, this means that there's no diff between a local state and the deployment in the cluster. Is this correct?

Just the opposite, this means helm didn't find such release in the cluster and diff will show you entire contents as new vs only showing you differences.

At any point you can do helm list to see what releases you have deployed.