The alloying element which increases residual magnetism and coercive magnetic force in steel for magnets is

Cobalt improves strength at high temperatures and magnetic permeability.
Increases hardness, also allows for higher quenching temperatures (during the heat treatment procedure). Intensifies the individual effects of other elements in more complex steels. Co is not a carbide former, however adding Cobalt to the alloy allows for higher attainable hardness and higher red hot hardness.