I have schooled a number of horses from getting on for the first time to Grand Prix. Over the years, I've changed my mind about what I look for in dressage prospects. Like most people, I started out thinking that I wanted a horse with exceptional thrust and air time in his stride; that aspect was most important. I looked at how a horse trotted, how much cadence he had, how much expression there was and so on. I was looking for a big mover--a floating trot and a big, off-the-ground canter. This often took precedence over the quality of the canter and walk.
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Over the years, I realized that big movers can have severe downsides. Many of the big movers that I trained would start out well and win everything through Second Level, sometimes Third Level. The judge would look at the horse with one eye and say that collection will come. I remember one horse in particular that, when people saw him in a lower-level class or loose in the field, they would just drool. That horse won everything. He was U.S. Dressage Federation (USDF) Horse of the Year several times and was unbeatable until Second Level.
Then, the success came to a grinding halt. As soon as we tried to compact and get him to collect in his gaits and make him lift instead of push his body forward, he became frantic. He had always been a very sweet and willing horse as long as he did not have to collect. We finally sold him, and he is now a happy amateur jumper. Ever since, I've seen many dressage prospects that were huge movers and were impressive at the lower-levels, but when it came to collecting the horse more and moving up the FEI levels, the movement often became a hindrance.
Today when I go out and look for horses, I always think Fédération Equestre International (FEI). When I see a young horse in the pasture with a big, floating trot often combined with a big canter, I still enjoy looking at his movement and it makes me stop and go, "Wow!" But my first priority is the horse's ability to collect well, which can already be seen at a very young age without riding him. When I watch a potential 2-year-old dressage prospect move in the field or loose in the ring, I look for athletic ability and power coming from his hind end, not his movement. For instance, when the horse gallops forward and then suddenly stops, I want to see that he uses his hind legs to balance the rest of his body. When he canters and comes to a wall or has to stop and turn, then I want him to sit and almost slide stop, like western horses. I love it when they just twirl, do a roll back and go the other way.
Also, I like the horse to be happy to canter. He must like to go to the canter and not just prefer to always trot around. If horses only trot when you let them loose, I get a bit suspicious about the canter. Another thing I like to see--and this might sound funny--is when they lie down, flip from one side to the other easily, get up and just buck.
Together with a good collecting ability, the horse also must have absolutely clean gaits, which means the rhythm has to be pure at the walk, trot and canter, because flaws at the walk and the canter are incredibly difficult to improve, even with good riding. You have to be very skilled to make a better walk out of a walk that tends to be lateral and the same thing with the canter. The trot does not have to be exceptional; it can be a somewhat mundane trot, even a little bit flat. I do look for a nice bend in the knees and articulation with the hind legs under, which you can find in a "normal" trot. There is an enormous amount you can do with the trot, as long as it has a clean rhythm. Any good rider can create a better trot, as long as the trot is regular and the horse is built reasonably well for collection.
If the trot is not enormous, it is also much easier to make the horse understand piaffe, and then you can bring him from piaffe to the passage. Rather than using the exceptional trotting horse and bringing him to passage because that is so easy for these types of horses, I prefer to go the other way. Then you don't have to slow the trot to get the passage but rather the opposite. This way, I also find it a lot easier to control the transitions between piaffe and passage.