Daimon is derived from the ancient Greek - daimonos, I think. Socrates famously declared he had such a daimon. ae is used in some languages to convey the sound of the diphthong alpha-iota, which sounds different in English due to the differences in stresses.
For instance, for both of us, since we have a background in the French language, we can read daimon as "dèmon" - the 'ai' sound, as opposed to how it would pronounced in English: aie, as is die or pie. So daimon would read phonetically as diemon, which is a bit of a distortion.