Isolate each puppy from the rest of the litter, preferably in another room or part of the yard. First, look for a puppy who is not afraid to walk around and explore it’s new environment.
The next thing to do is to drop a dish or loud metal pan, 10 to 15 feet from the puppy. The ideal response is one of interest and investigation. Your potential puppy should look in the direction for the dropped object, and within a few seconds, go forward and check it out.
Do not pick a puppy that runs and hides.
The second test you can do is to roll the puppy on his side. The ideal response is for the puppy to quietly allow you to roll him over, at least for a minute or two, before starting to squirm.
Along these lines, it is also a good idea to pick the puppy up in your arms and cradle him like a baby, with his back in your hands and his feet towards your chest. He should be calm and relaxed. I like a puppy who will gaze into my eyes quietly, for several minutes. This means that he will be an attentive and responsive, outgoing dog in later life. Be careful of the puppy who squirms a lot and is extremely vocal.
You should be able to touch every part of the puppy’s body, without him kicking and screaming about it. Touch his feet, his ears, and especially his gums. Another test is to hold the puppy with one hand, under his arm pits, and raise him straight in the air. As expected, the pup should remain quiet and calm.