For definition purposes, a Red Knot is one that resulted from a live branch in the tree and intergrown with the surrounding wood when the log was cut. And yes, they have a slight reddish color.
As you would expect, the presence of Red Knots and Black Knots in lumber has a definitive effect on determining the grade of Eastern White Pine lumber. The higher grades (Selects) severely restrict the size and number of Black Knots on the grade face. The Common grades (Finish, Premium, Standard, and Industrial) permit Black Knots on the lumber face but at a severely reduced maximum size limitation compared to Red Knots.
As an example, in a 1”x6” board of Eastern White Pine Premium Grade, the maximum size of a Black Knot cannot exceed 1”, compared to a Red Knot’s maximum knot size in that grade of 2-1/2”! Quite the difference and it’s all about appearance in Eastern White Pine!