It's not. It's just a pin. The sensor is magnetic.

As the pin enters the sensors magnetic field, it pushes up a voltage. When it reaches the center, it stops. As it leaves the magnetic field, it pulls a voltage down. In other words, it generates an AC voltage that the tach amplifier on the fender amplifies (duh) and sends to the tachometer. The tachometer is just a glorified AC voltmeter.