The most common magnetic metals are iron, nickel, and cobalt. Alloys (mixtures) that contain one or more of those elements are usually ferromagnets, meaning that the magnetic orientations of nearby atoms line up with each other on their own to make little magnetic domains. Near a permanent magnet or electromagnet, those domains tend to reorient so as to pull the magnetic material toward the other magnet, which is what you feel if you hold a permanent magnet near some iron.
Whether you can make a permanent magnet from the material depends on whether the magnetic directions of the domains tend to get stuck. If not, forces between the domains make them line up opposite to each other, and you can't make a good magnet. If they do get stuck, you can line up the domains with a big magnet, and they will stay lined up for a long time.
Alnico is an alloy made by combining aluminum, nickel, and cobalt. Thanks to the nickel and cobalt, which are both magnetic, it turns out alnico is magnetic. And the structure of alnico does allow you to make a permanent magnet out of it- the aluminum helps prevent magnetic domains from reorienting.
-Tamara (w. Mike W.)
(republished on 07/13/06)