Why does a neutron behave like a tiny magnet despite having no electric charge?

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Although the neutron is electrically neutral as a whole, it behaves like a tiny magnet because it possesses a magnetic dipole moment. This magnetic behavior suggests that the neutron is an entity composed of moving electric charges.1

While the neutron has no net electric charge, it is not a fundamental particle; rather, it is a composite baryon made of three quarks: two down quarks (each with a charge of −1/3) and one up quark (with a charge of +2/3). The internal motion of these fractionally charged quarks, combined with the particle's intrinsic spin, generates the magnetic moment. In physics, this property is measured in units of the nuclear magneton, which quantifies the magnetic strength of nuclei and nucleons.1234