Part of the fun for these types of specialist kits is to delve further into the context.
The instructions to assemble this kit were rudimentary and I had to resort to the internet and some books on tournament to understand how the parts go together. There were several German books on medieval tournaments, and I understand that this kit was based specifically on a type of Germanic joust under Emperor Maximillian. There were essentially two types of jousts:- Joust of War and Joust of Peace. The armour worn here was specific to the Joust of Peace. The knight wears large knee armour and the lance was supported by a lance rest (arret) during the tournament.
The painting instructions suggested a red caparison but after a lot of searching, I came across several illustrations which showed essentially the same knight drawn on a caparisoned horse but in different colours. The horse had a caparison, the front of which was a straw padded mantle (peytral) which covered the breast of the horse and the front legs of the knight. The horse's eyes were covered to prevent distraction. The knight wore an apron which was the same design as the rest of the caparison.