Discount arbitrage means that when the secondary market price of ETF fund share is less than the net value of fund share, you can buy ETF through the secondary market, then redeem a basket of stocks in the primary market and sell the stock portfolio to get cash. But premium arbitrage and discount arbitrage are in the opposite direction. Premium arbitrage means that when the ETF secondary market price exceeds the net share value, you can buy a stock portfolio, buy fund shares in the primary market, and then sell them in the secondary market to get cash.
ETF is listed on the exchange, which can be a primary market or a secondary market. The purpose is to equalize the price difference between the primary market and the secondary market of ETF funds. ETF arbitrage is to earn profits across the primary and secondary markets when the net price of the primary market deviates from the transaction price of the secondary market.