There is always a magnetic field around a magnet. It attracts ferruginous objects such as pieces of nickel or cobalt or steel or iron.In the old days, the Greeks noticed that the natural stones can attract steel pieces.From then on, they began the journey to discover magnets.
    Nowdays, neodymium magnets are made manually in many different shapes and sizes according to their expectation. One of the most common one is bar magnet, The magnetic compass needle which was invented by Chinese used commonly. The magnetic compass needle is a small magnet which is free to move on a pivot. one side of the compass needle points the north direction, and the other side points the opposite side. The end of a free magnet always points the North-South direction.
            
                                                                                          

     Many of us understand that each magnet has two different charges and that like same poles repel each other, opposite poles attract each other. But it is difficult to explain. A permanent magnet is made from a material that is magnetized and generate its own magnetic field. Materials that can be magnetized are called ferromagnetic.
    The following characteristics are magnet common features:
    1) The north pole of a magnet points the geomagnetic north pole;
    2) north poles repel north poles;
    3) south poles repel south poles;
    4) south poles attract north poles;
    5) north poles attract south poles;
    6) the strength of a magnet varies at different places on the magnet;
    7) magnets are the strongest at their poles;
    8) magnets strongly attract steel, nickel, cobalt, iron etc;
    If you want to know the theory of magnet, you must break right down to the atomic level. Around the nucleus of the atom there are electrons with negative charge. At first, scientists used to think that there's a circular orbit around a atom, but the fact is that it's more complicated.
    To wrap things up on "How does neodymium magnets  work", the atoms of ferromagnetic materials tend to have their own magnetic field created by the electrons that orbit them. Same groups of atoms tend to the same direction, each area has its own south pole and north pole. When a piece of iron without magnetism will point the random directions. If you add a current, the area will start to line up with the external magnetic field. the stronger current applied, the higher the number of aligned areas.