Checking correct chain length is easy. Shift your front derailleur to the largest chain ring, and shift your rear derailleur to your largest cassette sprocket. There should be only just enough chain to allow engagement, with the rear derailleur tensioner almost fully extended forward (but not binding). If the tensioner isn't nearly fully extended, you've got too much chain... if this engagement isn't possible, you haven't got enough chain.

Although this extreme gear combination should be avoided when riding, there should be enough chain to make it possible. Otherwise, in such cases where you absent-mindedly attempt it (or if someone else who borrowed your bike doesn't know any better) it can damage your your drive-train or even snap the chain in the process. Having more chain than necessary is just carrying surplus weight and can cause the chain to be overly sloppy on smaller gear combinations.

Be aware of your chain length, if you swap different purpose rear wheels with different cassette sizes... I got caught-out on this one!

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