If you are going to link exchange with another website, make sure the other website is worth it. There are a number of things you should consider before link exchange. 

  1. Positive Factor for Link Exchange
  2. Negative Factor or Avoid link Exchange
Let’s start with positive factor for link exchange:
a.      Related content.
b.      Something you feel that will benefit your visitors.
c.       High Domain Age and High PR which has good number of quality back links.
d.      Good Site structure.
Note: How to check domain age? http://whois.net, this website will tell the domain age of any website.

Negative Factor or Avoid link Exchange tips

a.      Avoid link farms.
b.      Low domain age and PR is a bad factor for link exchange. Some new domains have good PR through 301 redirect or using black hat methods.
c.       Low or poor site structure.
by Bindu.