Arnaiz had a love for sports and was shooting stuffed toys into a basket in early childhood. While studying at La Salle-Bacolod in elementary school, he competed in football and basketball. Football provided the speed and exceptional footwork, skills which would later develop him into an outstanding basketball player. He led his high school, St. Clement's Academy of La Paz, Iloilo City, to the PRISAA basketball championship. In college, he played for Ateneo de Manila which won the 1969 NCAA basketball championship during his rookie year.