Add the mayonnaise, ketchup, and prepared horseradish to a small bowl and stir until smooth.
Sprinkle in the garlic powder, smoked paprika, salt, and cayenne pepper, then mix until fully combined.
Taste the sauce and adjust if needed. If you like more heat, add a little extra cayenne or horseradish. If you want it milder, reduce the cayenne slightly.
Cover and refrigerate the sauce for about 30 minutes before serving so the flavors can fully develop.