Pick a high spot if you can. The best designs begin with a focus on drainage. When deciding where to locate the arena, find a spot where water can flow away easily. Try to avoid areas where water must travel to get to the lower elevations.
If the terrain is flat and there is no obvious high and/or low spot, give consideration filling an area to elevate the ring above the surrounding ground. (Drainage, Drainage, Drainage)
Start by preparing good strong "Subgrade" of compacted soil. This section should be graded so that surface water will drain away from riding areas.
The stone layer "Sub-Base" is placed on the subgrade. This layer is also compacted and must be strong as this will absorb the impact from the concentrated loads being placed on it. Normally, the stone is sized from a large size of roughly 3/4 inch down to a small size of stone dust.
The top layer "Surface" is placed on the sub-base. This layer is not compacted. It is intended to be relatively soft and porous to allow water to pass through it and away. The horse is in contact with this layer and it is important to have a surface that will be gentle on the horses joints.
It is common provide a conduit to allow water to travel away quickly. This is normally done with open graded stone or a combination of pipe and stone.
Dense Graded Aggregate