The sensor is designed to drive 4 to 20 mA through the output circuit regardless of the sensor supply voltage (within the allowed limits).
So, using a 250 Ohm resistor, Ohm's Law gives:
0.004A*250R = 1V
0.020A*250R = 5V
A better circuit includes a 10K resistor for overvoltage protection at the input, and has the negative sensor power supply connected to Arduino ground, as follows:
