Predictions of daily flows in ungauged streams frequently rely on index gauges, where the timing of the daily flow at the index gauge is assumed to be similar to that in the ungauged stream. When some limited flow measurements are available at the ungauged sites, the strength of correlation between these flows and candidate index gauges can inform the selection of the index gauges. Here the use of the correlation of daily flows to select index gauges is systematically evaluated using a large flow data set from the Ohio River Valley, USA. Then, a novel method is introduced for predicting the strength with which daily flows at different gauges are correlated with daily flow at a completely ungauged site, using the physical characteristics of the ungauged site. The index gauges can then be selected based on these predicted correlations. The analysis indicates that this new method provides a means of identifying index sites that will yield a desired level of accuracy in flow predictions at ungauged locations. The ungauged sites at which sufficient index gauges are not available are also identified, and flow predictions are not calculated for these sites. Using this new method improves the overall accuracy of predicted flows, relative to existing methods.